ck0000768847-20231231
VanEck
Funds
CM Commodity Index
Fund
Class
A: CMCAX / Class I: COMIX / Class Y:
CMCYX
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The
U.S. Securities and Exchange Commission and the U.S. Commodity Futures
Trading Commission have not approved or disapproved these securities or
passed upon the accuracy or adequacy of this Prospectus. Any
representation to the contrary is a criminal offense. |
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800.826.2333 vaneck.com
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TABLE
OF CONTENTS |
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I.
Summary Information |
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CM
Commodity Index Fund (Class A, I, Y) |
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II.
Investment Objective, Strategies, Policies, Risks and Other
Information |
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1.
Investment Objective |
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2.
Additional Information About Principal Investment Strategies and
Risks |
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3.
Additional Investment Strategies |
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4.
Other Information and Policies |
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III.
Shareholder Information |
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1.
How to Buy, Sell, Exchange or Transfer Shares |
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2.
How to Choose a Class of Shares |
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3.
Sales Charges |
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4.
Householding of Reports and Prospectuses |
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5.
Retirement Plans |
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6.
Federal Income Taxes |
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7.
Dividends and Capital Gains Distributions |
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8.
Management of the Fund and Service Providers |
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IV.
Description of the CMCI |
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V.
License Agreements and Disclaimers |
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VI.
Financial Highlights |
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Appendix
A: Intermediary Sales Charge Discounts and Waivers |
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CM
COMMODITY INDEX FUND (CLASS A, I,
Y) |
I.
SUMMARY INFORMATION
INVESTMENT
OBJECTIVE
The
CM Commodity Index Fund seeks to track, before fees and expenses, the
performance of the UBS Constant Maturity Commodity Total Return
Index.
FUND FEES AND
EXPENSES
This
table describes the fees and expenses that you may pay if you buy and hold
shares of the Fund. You
may pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
You may qualify
for Class A sales charge discounts if you and your family (includes spouse and
children under age 21) invest, or agree to invest in the future, at least
$25,000, in the aggregate, in Classes A and C of
the VanEck Funds. More information about these and other
discounts is available from your financial professional and in the “Shareholder
Information—Sales Charges” section of this prospectus, in the “Availability of
Discounts” section of the Fund’s Statement of Additional Information (“SAI”)
and, with respect to purchases of shares through specific intermediaries, in
Appendix A to this prospectus, entitled “Intermediary Sales Charge Discounts and
Waivers.”
Shareholder
Fees
(fees
paid directly from your investment)
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| Class
A |
Class
I |
Class
Y |
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Maximum
Sales Charge (load) imposed on purchases (as a percentage of offering
price) |
5.75% |
0.00% |
0.00% |
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Maximum
Deferred Sales Charge (load) (as a percentage of the lesser of the net
asset value or purchase price) |
0.00%¹ |
0.00% |
0.00% |
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Annual
Fund Operating Expenses
(expenses
that you pay each year as a percentage of the value of your
investment)
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| Class
A |
Class
I |
Class
Y |
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| Management
Fees |
0.65% |
0.65% |
0.65% |
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| Distribution
and/or Service (12b-1) Fees |
0.25% |
0.00% |
0.00% |
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| Other
Expenses |
0.42% |
0.24% |
0.28% |
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| Total
Annual Fund Operating Expenses |
1.32% |
0.89% |
0.93% |
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Fee
Waivers and/or Expense Reimbursements2 |
-0.37% |
-0.24% |
-0.23% |
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Total
Annual Fund Operating Expenses After Fee Waivers and/or Expense
Reimbursements |
0.95% |
0.65% |
0.70% |
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1 A contingent deferred sales charge for Class A shares of 1.00% for
one year applies to redemptions of qualified commissionable shares purchased at
or above the $1 million breakpoint
level.
2 Van Eck Absolute
Return Advisers Corporation (the “Adviser”) has agreed to waive fees and/or pay
Fund expenses to the extent necessary to prevent the operating expenses of the
Fund (excluding acquired fund fees and expenses, interest expense, trading
expenses, dividends and interest payments on securities sold short, taxes and
extraordinary expenses) from exceeding 0.95% for Class A, 0.65% for Class I, and
0.70% for Class Y of the Fund’s average daily net assets per year until
May 1, 2025. During such time, the
expense limitation is expected to continue until the Board of Trustees acts to
discontinue all or a portion of such expense
limitation.
EXPENSE
EXAMPLE
The
following example is intended to help you compare the cost of investing in the
Fund with the cost of investing in other mutual funds. The example assumes that
you invest $10,000 in the Fund for the time periods indicated and then either
redeem all of your shares at the end of these periods or continue to hold them.
The example also assumes that your investment has a 5% return each year and that
the Fund’s operating expenses remain the same, and applies fee waivers and/or
expense reimbursements, if any, for the periods indicated above under “Annual
Fund Operating Expenses.” Although your actual expenses may be higher or lower,
based on these assumptions, your costs would be:
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| Share
Status |
1
Year |
3
Years |
5
Years |
10
Years |
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| Class
A |
Sold or
Held |
$666 |
| $935 |
| $1,224 |
| $2,043 |
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| Class
I |
Sold
or Held |
$66 |
| $260 |
| $470 |
| $1,074 |
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| Class
Y |
Sold
or Held |
$72 |
| $273 |
| $492 |
| $1,122 |
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PORTFOLIO
TURNOVER
The
Fund pays transaction costs, such as commissions, when it buys and sells
securities (or “turns over” its portfolio). A higher portfolio turnover rate may
indicate that the Fund pays higher transaction costs and may result in higher
taxes when Fund shares are held in a taxable account. These costs, which are not
reflected in annual fund operating expenses or in the example, affect the Fund’s
performance. During the most recent fiscal year, the Fund’s portfolio turnover
rate was 0%
of the average value of its portfolio.
PRINCIPAL INVESTMENT
STRATEGIES
The
Fund seeks to achieve its investment objective by investing in instruments that
derive their value from the performance of the UBS Constant Maturity Commodity
Total Return Index (formerly known as UBS Bloomberg Constant Maturity Commodity
Total Return Index) (the “CMCI” or the “Index”), as described below, and in
bonds, debt securities and other fixed income instruments (“Fixed Income
Instruments”) issued by various U.S. public- or private-sector entities. The
Fund invests in commodity-linked derivative instruments, including commodity
index- linked notes, swap agreements, commodity futures contracts and options on
futures contracts that provide economic exposure to the investment returns of
the commodities markets, as represented by the CMCI and its
constituents.
Commodities
are assets that have tangible properties, such as oil, metals, and agricultural
products. A commodity-linked derivative is a derivative instrument whose value
is linked to the movement of a commodity, commodity index, commodity option or
futures contract. The value of commodity-linked derivative instruments may be
affected by overall market movements and other factors affecting the value of a
particular industry or commodity, such as weather, disease, embargoes, or
political and regulatory developments.
The
CMCI is a rules-based, composite benchmark index diversified across 29 commodity
components from the following five sectors: energy, precious metals, industrial
metals, agriculture and livestock. The CMCI is comprised of futures contracts
with maturities ranging from three months up to a maximum of about three years
for each commodity, depending on liquidity. The return of the CMCI reflects a
combination of (i) the returns on the futures contracts comprising the CMCI; and
(ii) the return based on a hypothetical fixed income portfolio representing
collateral for the hypothetical investment in futures contracts comprising the
CMCI. The selection and relative weightings of the components of the CMCI are
designed to reflect the economic significance and market liquidity of each
commodity, as determined based on global economic data, consumption data,
commodity futures prices, open interest and volume data. The CMCI maintains a
predefined target maturity for each commodity component by means of a continuous
rolling process, in which a weighted percentage of contracts with less time to
maturity for each commodity are replaced with contracts with more time to
maturity on a daily basis. The CMCI is rebalanced monthly back to the target
weightings of the commodity components of the CMCI and the target weightings of
all commodity components are revised once per year. A more detailed description
of the CMCI is contained in the "Description of the CMCI" section of this
prospectus.
The
Fund will seek to track the returns of the CMCI by entering into swap contracts
and commodity index-linked notes with one or more counterparties, which
contracts and notes will rise and fall in value in response to changes in the
value of the CMCI. As of the date of this prospectus, UBS AG, London (“UBS”) was
the only available counterparty with which the Fund may enter into such swap
contracts on the CMCI. The Fund may enter into such contracts and notes directly
or indirectly through a wholly owned subsidiary of the Fund (the “Subsidiary”).
Commodity index-linked notes are derivative debt instruments with principal
and/or coupon payments linked to the performance of commodity indices (such as
the CMCI). These commodity index-linked notes are sometimes referred to as
“structured notes” because the terms of these notes may be structured by the
issuer and the purchaser of the note. The Fund may also seek to gain exposure to
the individual commodity components of the CMCI by investing in futures
contracts that comprise the CMCI.
The
Fund currently expects that it will invest in all commodity-linked derivative
instruments through the Subsidiary, an exempted limited company organized under
the laws of the Cayman Islands. The Subsidiary is wholly owned and controlled by
the Fund and is advised by the Adviser. The Fund’s investment in the Subsidiary
is not expected to exceed 25% of the value of the Fund’s total assets at each
quarter-end of the Fund's fiscal year. The Fund's investment in the Subsidiary
generally provides the Fund with exposure to commodity-linked derivative
instruments within the limits of the federal tax laws, which limit the ability
of investment companies like the Fund to invest directly in such instruments.
The Subsidiary has the same investment objective as the Fund and will follow the
same general investment policies and restrictions except that, unlike the Fund,
it may invest without limit in commodity-linked derivative
instruments.
The
derivative instruments in which the Fund and the Subsidiary primarily intend to
invest are instruments linked to commodity indices, such as the CMCI, and
instruments linked to the value of a particular commodity or commodity futures
contract, or a subset of commodities or commodity futures contracts. These
instruments may specify exposure to commodity futures with different roll dates,
reset dates or contract months than those specified by a particular commodity
index. As a result, the commodity-linked derivatives component of the Fund’s
portfolio may deviate from the returns of any particular commodity index. The
Fund or the Subsidiary may over-weight or under-weight its exposure to a
particular commodity index, or a subset of commodities, such that the Fund has
greater or lesser exposure to that index than the value of the Fund’s net
assets, or greater or lesser exposure to a subset of commodities than is
represented by a particular commodity index.
Assets
not invested in commodity-linked derivative instruments or the Subsidiary may be
invested in Fixed Income Instruments, including derivative Fixed Income
Instruments.
The
average duration of the portfolio of Fixed Income Instruments will vary based on
interest rates and, under normal market conditions, is not expected to exceed
five years. Duration is a measure of the expected life of a fixed income
security that is used to determine the sensitivity of a security’s price to
changes in interest rates. The Fund will invest primarily in securities of the
U.S. Government and its agencies and investment grade bonds of private issuers
rated Baa3 or higher by Moody's Investor Service, Inc. or, if unrated,
determined by the Adviser to be of comparable quality. The Fund may, without
limitation, seek to obtain market exposure to the securities in which it
primarily invests by entering into a series of purchase and sale contracts or by
using other investment techniques (such as buy back or dollar rolls, repurchase
agreements or reverse repurchase agreements). The Fund may also invest, without
limitation, in money market funds.
PRINCIPAL
RISKS
There
is no assurance that the Fund will achieve its investment objective.
The Fund’s share price and return will fluctuate with changes in
the market value of the Fund’s portfolio securities. Accordingly, an investment
in the Fund involves the risk of losing
money.
Agricultural
Commodity Sector Risk.
The
performance of the Fund in part is linked to the daily performance of the spot
price of certain agricultural commodities, including corn, soybeans, sugar and
wheat. Investments in the agriculture sector may be highly volatile and can
change quickly and unpredictably due to a number of factors, including the
supply of and demand of each commodity, legislative or regulatory developments
relating to food safety, political, legal, financial, accounting and tax matters
and other events that the Fund cannot control. In addition, increased
competition caused by economic recession, labor difficulties and changing
consumer tastes and spending can affect the demand for agricultural products,
and consequently the value of investments in that sector. As a result, the price
of an agricultural commodity could decline, which would adversely affect an
investment in the Fund if it held that
commodity.
Commodities
and Commodity-Linked Instruments Risk.
Commodities include, among other things, energy products, agricultural products,
industrial metals, precious metals and livestock. The commodities markets may
fluctuate widely based on a variety of factors, including overall market
movements, economic events and policies, changes in interest rates or inflation
rates, changes in monetary and exchange control programs, war, acts of
terrorism, natural disasters and technological developments. Variables such as
disease, drought, floods, weather, trade, embargoes, tariffs and other political
events, in particular, may have a larger impact on commodity prices than on
traditional securities. These additional variables may create additional
investment risks that subject the Fund’s investments to greater volatility than
investments in traditional securities. The prices of commodities can also
fluctuate widely due to supply and demand disruptions in major producing or
consuming regions. Because certain commodities may be produced in a limited
number of countries and may be controlled by a small number of producers,
political, economic and supply-related events in such countries could have a
disproportionate impact on the prices of such commodities. These factors may
affect the value of the Fund’s investments in varying ways, and different
factors may cause the values and the volatility of the Fund’s investments to
move in inconsistent directions at inconsistent rates. Because the value of a
commodity-linked derivative instrument and structured note typically are based
upon the price movements of physical commodities, the value of these securities
will rise or fall in response to changes in the underlying commodities or
related index of investment.
Commodities
and Commodity-Linked Instruments Tax Risk. The
tax treatment of commodity-linked derivative instruments may be adversely
affected by changes in legislation, regulations or other legally binding
authority. If, as a result of any such adverse action, the income of the Fund
from certain commodity-linked derivatives were treated as non- qualifying
income, the Fund might fail to qualify as a regulated investment company and/or
be subject to federal income tax at the Fund level. The uncertainty surrounding
the treatment of certain derivative instruments under the qualification tests
for a regulated investment company may limit the Fund’s use of such derivative
instruments.
The
Fund may be required, for federal income tax purposes, to mark-to-market and
recognize as income for each taxable year any net unrealized gains and losses on
certain futures contracts and option contracts as of the end of the year as well
as those actually realized during the year. Gain or loss from futures contracts
required to be marked-to-market will be 60% long-term and 40% short-term capital
gain or loss if held directly by the Fund, but if held by the Subsidiary, as is
expected, such gains will be recognized as ordinary income by the Fund to the
extent of the Subsidiary’s annual net earnings if any. Application of this rule
may alter the timing and character of distributions to shareholders. The Fund
may be required to defer the recognition of losses on futures contracts or
certain option contracts to the extent of any unrecognized gains on related
positions held by the Fund.
Commodity
Index-Related Concentration Risk.
The Fund’s assets may be concentrated in a particular sector or
sectors or industry or group of industries to reflect the Index’s allocation to
those types of commodities in a particular sector or sectors or industry or
group of industries. Many or all of the commodities in the same sector or
industry may decline in value due to developments adversely affecting such
sector or industry. By concentrating its assets in a particular sector or
sectors or industry or group of industries, the Fund is subject to the risk that
economic, political or other conditions that have a negative effect on those
sectors and/or industries may negatively impact the Fund.
Commodity
Index Tracking Risk.
The
Fund’s return may not match the return of the Index for a number of reasons. For
example, the Fund incurs operating expenses, including taxes, not applicable to
the Index and incurs costs associated with buying and selling securities and
entering into derivatives transactions (if applicable), especially when
rebalancing the Fund’s securities holdings to reflect changes in the composition
of the Index or (if applicable) raising cash to meet redemptions or deploying
cash in connection with inflows into the Fund. The Fund's inability to replicate
the returns of the hypothetical fixed income portfolio component of the Index
and/or transaction costs, including brokerage costs, may decrease the Fund’s net
asset value.
Market
disruptions and regulatory restrictions could have an adverse effect on the
Fund’s ability to adjust its exposure to the required levels in order to track
the Index. Errors in the Index data, the Index computations and/or the
construction of the Index in accordance with its methodology may occur from time
to time and may not be identified and corrected by the Index provider, which may
have an adverse impact on the Fund and its shareholders. Shareholders should
understand that any gains from the Index provider’s or others’ errors will be
kept by the Fund and its shareholders and any losses or costs resulting from the
Index provider’s or others’ errors will be borne by the Fund and its
shareholders. Additionally, when the Index is rebalanced and the Fund in turn
rebalances its portfolio to attempt to increase the correlation between the
Fund’s portfolio and the Index, any transaction costs and market exposure
arising from such portfolio rebalancing will be borne directly by the Fund and
its shareholders. Apart from scheduled rebalances, the Index provider or its
agents may carry out additional ad hoc rebalances to the Index. Therefore,
errors and additional ad hoc rebalances carried out by the Index provider or its
agents to the Index may increase the costs to and the tracking error risk of the
Fund.
The
Fund may not be fully invested at times either as a result of cash flows into
the Fund or reserves of cash held by the Fund to pay expenses or to meet
redemptions. In addition, the Fund may not invest in certain securities included
in the Index, or invest in them in the exact proportions in which they are
represented in the Index. The Fund’s performance may also deviate from the
return of the Index for various reasons, including legal restrictions or
limitations imposed by the governments of certain countries, certain exchange
listing standards (where applicable), a lack of liquidity in markets in which
such securities trade, potential adverse tax consequences or other regulatory
reasons (such as diversification requirements). To the extent the Fund utilizes
depositary receipts, the purchase of depositary receipts may negatively affect
the Fund’s ability to track the performance of the Index and increase tracking
error, which may be exacerbated if the issuer of the depositary receipt
discontinues issuing new depositary receipts or withdraws existing depositary
receipts.
The
Fund may value certain of its investments, underlying currencies and/or other
assets based on fair value prices. To the extent the Fund calculates its net
asset value based on fair value prices and the value of the Index is based on
securities’ closing prices on local foreign markets (i.e., the value of the
Index is not based on fair value prices), the Fund’s ability to track the Index
may be adversely affected. The Fund’s performance may also deviate from the
performance of the Index due to the impact of withholding taxes, late
announcements relating to changes to the Index and high turnover of the Index.
When markets are volatile, the ability to sell securities at fair value prices
may be adversely impacted and may result in additional trading costs and/or
increase the index tracking risk. The Fund may also need to rely on borrowings
to meet redemptions, which may lead to increased expenses. For tax efficiency
purposes, the Fund may sell certain securities, and such sale may cause the Fund
to realize a loss and deviate from the performance of the Index. In light of the
factors discussed above, the Fund’s return may deviate significantly from the
return of the Index. Changes to the composition of the Index in connection with
a rebalancing or reconstitution of the Index may cause the Fund to experience
increased volatility, during which time the Fund’s index tracking risk may be
heightened.
Credit Risk.
Credit risk refers to the possibility that the issuer or guarantor of
a security will be unable and/or unwilling to honor its payment obligations
and/or default completely on securities. The Fund’s securities are subject to
varying degrees of credit risk, depending on the issuer’s financial
condition and on the terms of the securities, which may be reflected in credit
ratings. There is a possibility that the credit rating of a security may be
downgraded after purchase or the perception of an issuer’s creditworthiness may
decline, which may adversely affect the value of the security. Lower credit
quality may also affect liquidity and make it difficult for the Fund to sell the
security.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk refers
to the possibility that the issuer of a debt security will be unable to make
interest payments or repay principal when it becomes due. Interest rate risk
refers to fluctuations in the value of a debt security resulting from changes in
the general level of interest rates. Debt securities with longer durations have
higher risk and volatility. For example, if a bond has a duration of five years
and interest rates increase by 1%, the bond's price will decline by
approximately 5%.
Derivatives
Counterparty Risk. A
loss may be sustained as a result of the failure of another party to a contract
(usually referred to as a “counterparty”) to make required payments, fulfill its
contractual obligations or otherwise comply with a contract’s terms because of
the financial condition of the counterparty (i.e., financial difficulties or
insolvency), market activities and developments,
the
counterparty being unable or unwilling to perform under the contract or other
reasons. In a swap agreement, the Fund bears the risk of loss of the amount
expected to be received under the agreement in the event of the default or
bankruptcy of a counterparty. These risks are heightened and may materially
impact the Fund’s ability to achieve its investment objective given that the
Fund may enter into swap agreements with one or a limited number of
counterparties, and as
of the date of this prospectus, UBS was the only available counterparty with
which the Fund may enter into such swap contracts on the CMCI.
The Fund may also invest in commodity-linked structured notes issued by a
limited number of issuers that will act as counterparties. The Fund’s use of one
or a limited number of counterparties and its investments in commodity-linked
structured notes issued by only a limited number of issuers increases the Fund’s
exposure to counterparty credit risk. Credit risk refers to the possibility that
the counterparty will be unable and/or unwilling to honor its obligations and/or
default completely on the derivative transaction. Swap agreements also may be
considered to be illiquid. Further, there is a risk that no suitable
counterparties are willing to enter into, or continue to enter into,
transactions with the Fund and, as a result, the Fund may not be able to achieve
its investment objective.
Derivatives
Risk.
Derivatives and other similar instruments (referred to collectively as
“derivatives”) are financial instruments whose values are based on the value of
one or more reference assets or indicators, such as a security, currency,
interest rate, or index. The Fund’s use of derivatives involves risks different
from, and possibly greater than, the risks associated with investing directly in
securities and other more traditional investments. Moreover, although the value
of a derivative is based on an underlying asset or indicator, a derivative
typically does not carry the same rights as would be the case if the Fund
invested directly in the underlying securities, currencies or other
assets.
Derivatives
are subject to a number of risks, such as potential changes in value in response
to market developments or, in the case of “over-the-counter” derivatives, as a
result of a counterparty’s credit quality and the risk that a derivative
transaction may not have the effect the Adviser anticipated. Derivatives also
involve the risk of mispricing or improper valuation and the risk that changes
in the value of a derivative may not achieve the desired correlation with the
underlying asset or indicator. Derivative transactions can create investment
leverage and may be highly volatile, and the Fund could lose more than the
amount it invests. The use of derivatives may increase the amount and affect the
timing and character of taxes payable by shareholders of the Fund.
Many
derivative transactions are entered into “over-the-counter” without a central
clearinghouse; as a result, the value of such a derivative transaction will
depend on, among other factors, the ability and the willingness of the Fund’s
counterparty to perform its obligations under the transaction. If a counterparty
were to default on its obligations, the Fund’s contractual remedies against such
counterparty may be subject to bankruptcy and insolvency laws, which could
affect the Fund’s rights as a creditor (e.g.,
the Fund may not receive the net amount of payments that it is contractually
entitled to receive). Counterparty risk also refers to the related risks of
having concentrated exposure to such a counterparty. A liquid secondary market
may not always exist for the Fund’s derivative positions at any time, and the
Fund may not be able to initiate or liquidate a swap position at an advantageous
time or price, which may result in significant losses. The Fund may also face
the risk that it may not be able to meet margin and payment requirements and
maintain a derivatives position.
Derivatives
are also subject to operational and legal risks. Operational risk generally
refers to risk related to potential operational issues, including documentation
issues, settlement issues, system failures, inadequate controls, and human
errors. Legal risk generally refers to insufficient documentation, insufficient
capacity or authority of counterparty, or legality or enforceability of a
contract.
Energy
Commodity Sector Risk. The
performance of the Fund in part is linked to the daily performance of the spot
price of certain energy-related commodities such as crude oil. The market values
of such commodities are strongly affected by the supply of, and demand for,
those commodities, as well as, among other factors, capital expenditures on
exploration and production, energy conservation efforts, government regulation
and subsidization, world event, technological advances and general economic
conditions. Therefore, energy commodities are subject to swift price
fluctuations, and investments in such commodities can be cyclical and/or highly
volatile. Additionally, significant declines in the price of oil may contribute
to significant market volatility, which may materially adversely affect the
Fund’s performance.
Gap
Risk. The
Fund and the Subsidiary are subject to the risk that a commodity price will
fluctuate even during periods when there is no trading. Usually, such movements
occur when there are adverse news announcements, which can cause a commodity
price to drop substantially from the previous day’s closing
price.
Interest Rate Risk.
Debt
securities and preferred securities are subject to interest rate risk. Interest
rate risk refers to fluctuations in the value of a security resulting from
changes in the general level of interest rates. When the general level of
interest rates goes up, the prices of most debt securities and certain preferred
securities go down. When the general level of interest rates goes down, the
prices of most debt securities go up. Many factors can cause interest rates to
rise, including central bank monetary policy, rising inflation rates and general
economic conditions. Debt securities with longer durations tend to be more
sensitive to interest rate changes, usually making them more volatile than debt
securities, such as bonds, with shorter durations. A substantial investment by
the Fund in debt securities with longer-term maturities during periods of rising
interest rates may cause the value of the Fund’s investments to decline
significantly. Changing interest rates may have unpredictable effects on
markets, may result in heightened market volatility and may detract from Fund
performance to the extent the Fund is exposed to such interest rates
and/
or volatility. It is difficult to predict the magnitude, timing or
direction of interest rate changes and the impact these changes will have on the
markets in which the Fund invests.
Market
Risk.
The prices of securities are subject to the risks associated with investing in
the securities market, including general economic conditions, sudden and
unpredictable drops in value, exchange trading suspensions and closures and
public health risks. These risks may be magnified if certain social, political,
economic and other conditions and events (such as natural disasters, epidemics
and pandemics, terrorism, conflicts and social unrest) adversely interrupt the
global economy; in these and other circumstances, such events or developments
might affect companies world-wide. Overall securities values could decline
generally or underperform other investments. An investment may lose
money.
Metals
Commodity Sector Risk.
The
performance of the Fund in part is linked to the daily performance of the spot
price of certain industrial and precious metals, including aluminum, copper,
gold, silver and zinc. Investments in metals may be highly volatile and can
change quickly and unpredictably due to a number of factors, including the
supply and demand of each metal, environmental or labor costs, political, legal,
financial, accounting and tax matters and other events that the Fund cannot
control. In addition, changes in international monetary policies or economic and
political conditions can affect the supply of metals, and consequently the value
of metal investments. The United States or foreign governments may pass laws or
regulations limiting metal investments for strategic or other policy reasons.
Further, the principal supplies of metal industries may be concentrated in a
small number of countries and regions. Consequently, the price of a metal held
by the Fund could decline, which would adversely affect the Fund’s
performance.
Money
Market Funds Risk. Although
a money market fund is designed to be a relatively low risk investment, it is
subject to certain risks. An investment in a money market fund is not a bank
account and is not insured or guaranteed by a Federal Deposit Insurance
Corporation or any other government agency. Although money market funds seek to
maintain a net asset value of $1.00 per share, it is possible that the Fund may
lose money by investing in a money market
fund.
Operational
Risk.
The Fund is exposed to operational risk arising from a number of factors,
including human error, processing and communication errors, errors of the Fund’s
service providers, counterparties or other third-parties, failed or inadequate
processes and technology or system failures.
Passive
Management Risk.
Unlike many investment companies, the Fund is not “actively” managed.
Therefore, unless a specific security/asset is removed from its Index, the Fund
generally would not sell such a security/asset because the security’s
issuer/asset is in financial trouble. If a specific security/asset is removed
from the Fund’s Index, the Fund may be forced to sell such security/asset at an
inopportune time or for prices other than at current market values. An
investment in the Fund involves risks similar to those of investing in any fund
that invests in a similar asset class, such as market fluctuations caused by
such factors as economic and political developments, changes in interest rates
and perceived trends in security/asset prices. The Fund’s Index may not contain
the appropriate or a diversified mix of securities and/or assets for any
particular economic cycle. The timing of changes in the composition of the
Fund’s portfolio in seeking to track its Index could have a negative effect on
the Fund. Unlike with an actively managed fund, the Adviser does not use
techniques or defensive strategies designed to lessen the effects of market
volatility or to reduce the impact of periods of market decline. Additionally,
unusual market conditions may cause the Fund’s Index provider to postpone a
scheduled rebalance or reconstitution, which could cause the Fund’s Index to
vary from its normal or expected composition. This means that, based on market
and economic conditions, the Fund’s performance could be lower than funds that
may actively shift their portfolio assets to take advantage of market
opportunities or to lessen the impact of a market decline or a decline in the
value of one or more issuers.
Regulatory
Risk. Changes
in the laws or regulations of the United States, including any changes to
applicable tax laws and regulations, could impair the ability of the Fund to
achieve its investment objective and could increase the operating expenses of
the Fund. The Adviser is registered as a commodity pool operator under the U.S.
Commodity Exchange Act and the rules of the U.S. Commodity Futures Trading
Commission (“CFTC”) and is subject to CFTC regulation with respect to the Fund.
The CFTC has adopted rules regarding the disclosure, reporting and recordkeeping
requirements that will apply with respect to the Fund as a result of the
Adviser’s registration as a commodity pool operator. Generally, these rules
allow for substituted compliance with CFTC disclosure and shareholder reporting
requirements, based on the Adviser’s compliance with comparable Securities and
Exchange Commission requirements. This means that for most of the CFTC’s
disclosure and shareholder reporting applicable to the Adviser as the Fund’s
commodity pool operator, the Adviser’s compliance with Securities and Exchange
Commission disclosure and shareholder reporting will be deemed to fulfill the
Adviser’s CFTC compliance obligations. However, as a result of CFTC regulation
with respect to the Fund, the Fund may incur additional compliance and other
expenses. The Adviser is also registered as a “commodity trading advisor”
(“CTA”) but relies on an exemption with respect to the Fund from CTA regulations
available for a CTA that also serves as the Fund’s commodity pool operator. The
CFTC has neither reviewed nor approved the Fund, their investment strategies, or
this Prospectus.
Repurchase
Agreements Risk.
A repurchase agreement exposes the Fund to the risk that the party that sells
the security may default on its obligation to repurchase it. The Fund may lose
money if it cannot sell the security at the agreed-upon time and price or the
security loses value before it can be sold. A reverse repurchase agreement
involves the risk that the market value of the securities the Fund is obligated
to repurchase under the agreement may decline below the repurchase
price.
Subsidiary
Investment Risk.
Changes in the laws of the United States and/or the Cayman Islands, under which
the Fund and the Subsidiary are organized, respectively, could result in the
inability of the Fund to operate as intended and could negatively affect the
Fund and its shareholders. The Subsidiary is not registered under the Investment
Company Act of 1940 and is not subject to the investor protections of the
Investment Company Act of 1940. Thus, the Fund, as an investor in the
Subsidiary, will not have all the protections offered to investors in registered
investment companies.
Tax
Risk (with respect to investments in the Subsidiary).
The Fund must derive at least 90% of its gross income from certain qualifying
sources of income in order to qualify as a regulated investment company under
the Internal Revenue Code of 1986. The Internal Revenue Service issued a revenue
ruling in December 2005, which concluded that income and gains from certain
commodity-linked derivatives are not qualifying income under Subchapter M of the
Internal Revenue Code of 1986. As a result, the Fund’s ability to invest
directly in commodity-linked futures contracts or swaps or in certain
exchange-traded trusts that hold commodities as part of its investment strategy
is limited by the requirement that it receive no more than ten percent (10%) of
its gross income from such investments. The Fund expects to invest its assets in
the Subsidiary, consistent with applicable law and the advice of counsel, in a
manner that should permit the Fund to treat income allocable from the Subsidiary
as qualifying income. The Internal Revenue Service has issued regulations that
treat a fund’s income inclusion with respect to an investment in a non-U.S.
company generating investment income as qualifying income only if there is a
current-year distribution out of the earnings and profits of the non-U.S.
company that are attributable to such income inclusion or if the income from the
Subsidiary is related to the Fund's business of investing. The Fund intends to
treat its income from the Subsidiary as qualifying income. There can be no
assurance that the Internal Revenue Service will not change its position with
respect to some or all of these issues or if the Internal Revenue Service did
so, that a court would not sustain the Internal Revenue Service’s position.
Furthermore, the tax treatment of the Fund’s investments in the Subsidiary may
be adversely affected by future legislation, court decisions, future Internal
Revenue Service guidance or Treasury
regulations.
U.S.
Treasury Securities Risk.
Direct obligations of the U.S. Treasury have historically involved little risk
of loss of principal if held to maturity. However, due to fluctuations in
interest rates, the market value of such securities may
vary.
PERFORMANCE
The following chart and table provide some indication of the
risks of investing in the Fund by showing changes in the Fund’s performance from
year to year and by showing how the Fund’s average annual total returns compare
with the Fund’s benchmark index and those of a broad measure of market
performance. The Fund’s
past performance (before and after taxes) is not necessarily an indication of
how the Fund will perform in the future. The annual returns
in the bar chart are for the Fund’s Class A shares and do not reflect sales
loads. If sales loads were reflected, returns would be lower than those
shown.
Additionally,
large purchases and/or redemptions of shares of a class, relative to the amount
of assets represented by the class, may cause the annual returns for each class
to differ. Updated performance information for the Fund is available on the
VanEck website at vaneck.com.
Class A: Annual Total
Returns (%) as of 12/31
|
|
|
|
|
|
|
| |
Best
Quarter: |
+21.58% |
1Q 2022 |
Worst
Quarter: |
-24.73% |
1Q
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
| |
| Average
Annual Total Returns as of 12/31/2023 |
1
Year |
5
Years |
10
Years |
|
|
Class
A Shares
(12/31/10) |
|
|
| |
| Before
Taxes |
-8.45% |
8.99% |
0.01% |
|
|
After
Taxes on Distributions1 |
-9.74% |
5.03% |
-2.41% |
|
|
After Taxes
on Distributions and Sale of Fund Shares |
-5.00% |
5.34% |
-1.06% |
|
|
Class
I Shares
(12/31/10) |
|
|
| |
| Before
Taxes |
-2.63% |
10.59% |
0.89% |
|
|
Class
Y Shares
(12/31/10) |
|
|
| |
| Before
Taxes |
-2.77% |
10.56% |
0.84% |
|
|
UBS
Constant Maturity Commodity Index
(reflects no deduction for fees, expenses or
taxes)2 |
-1.41% |
11.90% |
2.04% |
|
|
S&P
500 Index
(reflects no deduction for fees, expenses or
taxes) |
26.29% |
15.69% |
12.03% |
|
|
|
|
|
| |
1 After-tax returns are calculated using the historical highest
individual federal marginal income tax rates and do not reflect the impact of
state and local taxes. These
returns are shown for one class of shares only; after-tax returns for the other
classes may vary. Actual after-tax returns depend on your
individual tax situation and may differ from those shown in the preceding table.
The after-tax return information shown above does not apply
to Fund shares held through a tax-advantaged account, such as a 401(k) plan or
Investment Retirement Account.
2
Performance of the UBS
Constant Maturity Commodity Index prior to July 18, 2022 reflects the UBS
Constant Maturity Commodity Index’s previous methodology which had a different
funding reference rate than the current index
methodology.
See
“License Agreements and Disclaimers” for important
information.
PORTFOLIO
MANAGEMENT
Investment
Adviser.
Van Eck Absolute Return Advisers Corporation
Portfolio
Managers.
Roland
Morris, Jr. has been Portfolio Manager of the Fund since 2014. Chris Mailloux
has been Deputy Portfolio Manager of the Fund since May 2024. Mr. Mailloux has
also been employed by Van Eck Associates Corporation since 2007.
PURCHASE
AND SALE OF FUND SHARES
In
general, shares of the Fund may be purchased or redeemed on any business day,
primarily through financial representatives such as brokers or advisers, or
directly by eligible investors through the Fund’s transfer agent. Purchase
minimums for Classes A and Y shares are $1,000 for an initial purchase and $100
for a subsequent purchase, with no purchase minimums for any purchase through a
retirement or pension plan account, for any “wrap fee” account and similar
programs offered without a sales charge by certain financial institutions and
third-party recordkeepers and/or administrators, and for any account using the
Automatic Investment Plan, or for any other periodic purchase program. Purchase
minimums for Class I shares are $1 million for an initial purchase and no
minimum for a subsequent purchase; the initial minimum may be reduced or waived
at the Adviser’s discretion.
TAX
INFORMATION
The
Fund normally distributes net investment income and net realized capital gains,
if any, to shareholders annually. These distributions are generally taxable to
you as ordinary income or capital gains, unless you are investing through a tax
advantaged retirement account, such as a 401(k) plan or an individual retirement
account (IRA), in which case your distributions may be taxed as ordinary income
when withdrawn from such account.
PAYMENTS
TO BROKER-DEALERS AND OTHER FINANCIAL INTERMEDIARIES
If
you purchase the Fund through a broker-dealer or other financial intermediary
(such as a bank), the Fund and/or its affiliates may pay the intermediary for
the sale of Fund shares and related services. These payments may create a
conflict of interest by influencing the broker-dealer or other intermediary and
your financial professional to recommend the Fund over another investment. Ask
your financial professional or visit your financial intermediary’s website for
more information.
|
| |
II.
INVESTMENT OBJECTIVE, STRATEGIES, POLICIES, RISKS AND OTHER
INFORMATION |
This
section states the Fund’s investment objective and describes certain strategies
and policies that the Fund may utilize in pursuit of its investment objective.
This section also provides additional information about the principal risks
associated with investing in the Fund.
1.
INVESTMENT OBJECTIVE
The
CM Commodity Index Fund seeks to track, before fees and expenses, the
performance of the UBS Constant Maturity Commodity Total Return
Index.
The
Fund’s investment objective is non-fundamental and may be changed by the Board
of Trustees (the “Board”) without shareholder approval. The Fund has adopted a
policy that requires the Fund to provide shareholders with 60 days’ prior
written notice before its investment objective can be changed (to the extent
practicable).
2.
ADDITIONAL INFORMATION ABOUT PRINCIPAL INVESTMENT STRATEGIES AND
RISKS
Agricultural
Commodity Sector Risk.
The
performance of the Fund in part is linked to the daily performance of the spot
price of certain agricultural commodities, including corn, soybeans, sugar and
wheat. Investments in the agriculture sector may be highly volatile and can
change quickly and unpredictably due to a number of factors, including the
supply of and demand of each commodity, legislative or regulatory developments
relating to food safety, political, legal, financial, accounting and tax matters
and other events that the Fund cannot control. In addition, increased
competition caused by economic recession, labor difficulties and changing
consumer tastes and spending can affect the demand for agricultural products,
and consequently the value of investments in that sector. As a result, the price
of an agricultural commodity could decline, which would adversely affect an
investment in the Fund if it held that commodity.
Commodities
and Commodity-Linked Instruments Risk. Commodities
include, among other things, energy products, agricultural products, industrial
metals, precious metals and livestock. The commodities markets may fluctuate
widely based on a variety of factors, including overall market movements,
economic events and policies, changes in interest rates or inflation rates,
changes in monetary and exchange control programs, war, acts of terrorism,
natural disasters and technological developments. Variables such as disease,
drought, floods, weather, trade, embargoes, tariffs and other political events,
in particular, may have a larger impact on commodity prices than on traditional
securities. These additional variables may create additional investment risks
that subject the Fund’s investments to greater volatility than investments in
traditional securities. The prices of commodities can also fluctuate widely due
to supply and demand disruptions in major producing or consuming regions.
Because certain commodities may be produced in a limited number of countries and
may be controlled by a small number of producers, political, economic and
supply-related events in such countries could have a disproportionate impact on
the prices of such commodities. These factors may affect the value of the Fund’s
investments in varying ways, and different factors may cause the values and the
volatility of the Fund’s investments to move in inconsistent directions at
inconsistent rates. Because the value of a commodity-linked derivative
instrument and structured note typically are based upon the price movements of
physical commodities, the value of these securities will rise or fall in
response to changes in the underlying commodities or related index of
investment.
Commodities
and Commodity-Linked Instruments Tax Risk. The
tax treatment of commodity-linked derivative instruments may be adversely
affected by changes in legislation, regulations or other legally binding
authority. If, as a result of any such adverse action, the income of the Fund
from certain commodity-linked derivatives were treated as non- qualifying
income, the Fund might fail to qualify as a regulated investment company and/or
be subject to federal income tax at the Fund level. The uncertainty surrounding
the treatment of certain derivative instruments under the qualification tests
for a regulated investment company may limit the Fund’s use of such derivative
instruments.
The
Fund may be required, for federal income tax purposes, to mark-to-market and
recognize as income for each taxable year any net unrealized gains and losses on
certain futures contracts and option contracts as of the end of the year as well
as those actually realized during the year. Gain or loss from futures contracts
required to be marked-to-market will be 60% long-term and 40% short-term capital
gain or loss if held directly by the Fund, but if held by the Subsidiary, as is
expected, such gains will be recognized as ordinary income by the Fund to the
extent of the Subsidiary’s annual net earnings if any. Application of this rule
may alter the timing and character of distributions to shareholders. The Fund
may be required to defer the recognition of losses on futures contracts or
certain option contracts to the extent of any unrecognized gains on related
positions held by the Fund.
Commodity
Index-Related Concentration Risk.
The
Fund’s assets may be concentrated in a particular sector or sectors or industry
or group of industries to reflect the Index’s allocation to those types of
commodities in a particular sector or sectors or industry or group of
industries. Many or all of the commodities in the same sector or industry may
decline in value due to developments adversely affecting such sector or
industry. By concentrating its assets in a particular sector or sectors or
industry or group of industries, the Fund is subject to the risk that economic,
political or other conditions that have a negative effect on those sectors
and/or industries may negatively impact the Fund.
Commodity
Index Tracking Risk.
The
Fund’s return may not match the return of the Index for a number of reasons. For
example, the Fund incurs operating expenses, including taxes, not applicable to
the Index and incurs costs associated with buying and selling securities and
entering into derivatives transactions (if applicable), especially when
rebalancing the Fund’s securities holdings to reflect changes in the composition
of the Index or (if applicable) raising cash to meet redemptions or deploying
cash in
connection
with inflows into the Fund. The Fund's inability to replicate the returns of the
hypothetical fixed income portfolio component of the Index and/or transaction
costs, including brokerage costs, may decrease the Fund’s net asset
value.
Market
disruptions and regulatory restrictions could have an adverse effect on the
Fund’s ability to adjust its exposure to the required levels in order to track
the Index. Unusual market conditions may cause the Index provider to postpone a
scheduled rebalance, which could cause the Index to vary from its normal or
expected composition. There is no assurance that the Index provider or any
agents that may act on its behalf will compile the Index accurately, or that the
Index will be determined, composed or calculated accurately. Errors in respect
of the quality, accuracy and completeness of the data used to compile the Index
may occur from time to time and may not be identified and corrected by the Index
provider, particularly where the indices are less commonly used as benchmarks by
funds or managers. Therefore, gains, losses or costs associated with errors of
the Index provider or its agents will generally be borne by the Fund and its
shareholders. For example, during a period where the Index contains incorrect
constituents, the Fund would have market exposure to such constituents and would
be underexposed to the Index’s other constituents. Such errors may negatively or
positively impact the Fund and its shareholders.
When
the Index is rebalanced and the Fund in turn rebalances its portfolio to attempt
to increase the correlation between the Fund’s portfolio and the Index, any
transaction costs and market exposure arising from such portfolio rebalancing
will be borne directly by the Fund and its shareholders. The Fund may not be
fully invested at times either as a result of cash flows into the Fund or
reserves of cash held by the Fund to pay expenses or to meet redemptions. In
addition, the Fund may not invest in certain securities and/or other assets
included in the Index, or invest in them in the exact proportions in which they
are represented in the Index. The Fund’s performance may also deviate from the
return of the Index for a variety of reasons, including legal restrictions or
limitations imposed by the governments of certain countries, certain exchange
listing standards (where applicable), a lack of liquidity in markets in which
such securities trade, potential adverse tax consequences or other regulatory
reasons (such as diversification requirements). A lack of liquidity may be due
to various events, including market events, economic conditions or investor
perceptions. Illiquid securities may be difficult to value and their value may
be lower than the market price of comparable liquid securities, which would
negatively affect the Fund’s performance. Moreover, the Fund may be delayed in
purchasing or selling securities included in the Index. When markets are
volatile, the ability to sell securities at fair value prices may be adversely
impacted and may result in additional trading costs and/or increase the index
tracking risk. The Fund may also need to rely on borrowings to meet redemptions,
which may lead to increased expenses. For tax efficiency purposes, the Fund may
sell certain securities, and such sale may cause the Fund to realize a loss and
deviate from the performance of the Index. The Fund’s performance may also
deviate from the performance of the Index due to the impact of withholding
taxes, late announcements relating to changes to the Index and high turnover of
the Index.
The
Fund may fair value certain of its investments, underlying currencies and/or
other assets. To the extent the Fund calculates its net asset value based on
fair value prices and the value of the Index is based on securities’ closing
prices on local foreign markets (i.e., the value of the Index is not based on
fair value prices) or if the Fund otherwise calculates its net asset value based
on prices that differ from those used in calculating the Index, the Fund’s
ability to track the Index may be adversely affected. The need to comply with
the tax diversification and other requirements of the Internal Revenue Code of
1986 may also impact the Fund’s ability to track the performance of the Index.
In addition, if the Fund utilizes depositary receipts or other derivative
instruments, its return may not correlate as well with the return of the Index
as would be the case if the Fund purchased all the securities in the Index
directly. To the extent the Fund utilizes depositary receipts, the purchase of
depositary receipts may negatively affect the Fund’s ability to track the
performance of the Index and increase tracking error, which may be exacerbated
if the issuer of the depositary receipt discontinues issuing new depositary
receipts or withdraws existing depositary receipts. Actions taken in response to
proposed corporate actions could also result in increased tracking error. In
light of the factors discussed above, the Fund’s return may deviate
significantly from the return of the Index.
Apart
from scheduled rebalances, the Index provider or its agents may carry out
additional ad hoc rebalances to the Index in order, for example, to correct an
error in the selection of index constituents. When the Index is rebalanced and
the Fund in turn rebalances its portfolio to attempt to increase the correlation
between the Fund’s portfolio and the Index, any transaction costs and market
exposure arising from such portfolio rebalancing will be borne directly by the
Fund and its shareholders. Therefore, errors and additional ad hoc rebalances
carried out by the Index provider to the Index may increase the costs to and the
tracking error risk of the Fund.
Index
tracking risk may be heightened during times of increased market volatility or
other unusual market conditions. Changes to the composition of the Index in
connection with a rebalancing or reconstitution of the Index may cause the Fund
to experience increased volatility, during which time the Fund’s index tracking
risk may be heightened.
Credit Risk.
Credit risk refers
to the possibility that the issuer or guarantor of a security will be unable
and/or unwilling to honor its payment obligations and/or default completely on
securities. The Fund’s securities are subject to varying degrees
of credit risk, depending on the issuer’s financial condition and on
the terms of the securities, which may be reflected in credit ratings. There is
a possibility that the credit rating of a security may be downgraded after
purchase or the perception of an issuer’s creditworthiness may decline, which
may adversely affect the value of the security. Lower credit quality may also
affect liquidity and make it difficult for the Fund to sell the
security.
Debt
Securities Risk. Debt
securities are subject to credit risk and interest rate risk. Credit risk refers
to the possibility that the issuer of a debt security will be unable to make
interest payments or repay principal when it becomes due. Interest rate risk
refers to fluctuations in the value of a debt security resulting from changes in
the general level of interest rates. Debt securities with longer durations have
higher risk and volatility. For example, if a bond has a duration of five years
and interest rates increase by 1%, the bond's price will decline by
approximately 5%.
Derivatives
Counterparty Risk. The
Fund may invest in financial instruments involving counterparties for the
purpose of attempting to gain exposure to a particular group of securities,
commodities or asset class without actually purchasing those securities or
investments, or to hedge a position. Such financial instruments include, but are
not limited to total return, index, interest rate, and credit default swap
agreements, and structured notes. The Fund will use counterparty agreements to
exchange the returns (or differentials in rates of return) earned or realized in
particular predetermined investments or instruments. The Fund will not enter
into any agreement involving a counterparty unless the Adviser believes that the
other party to the transaction is creditworthy. A loss may be sustained as a
result of the failure of a counterparty to make required payments, fulfill its
contractual obligations or otherwise comply with a contract’s terms because of
the financial condition of the counterparty (i.e., financial difficulties or
insolvency), market activities and developments, the counterparty being unable
or unwilling to perform under the contract or other reasons.
The
use of swap agreements and structured notes involves risks that are different
from those associated with ordinary portfolio securities transactions. For
example, the Fund bears the risk of loss of the amount expected to be received
under a swap agreement in the event of the default or bankruptcy of a
counterparty. These risks are heightened and may materially impact the Fund’s
ability to achieve its investment objective given that the Fund may enter into
swap agreements with a limited number of counterparties, and as
of the date of this prospectus, UBS was the only available counterparty with
which the Fund may enter into such swap agreements on the CMCI.
The Fund may also invest in commodity-linked structured notes issued by a
limited number of issuers that will act as counterparties. The Fund’s use of one
or a limited number of counterparties and its investments in commodity-linked
structured notes issued by only a limited number of issuers increases the Fund’s
exposure to counterparty credit risk. Credit risk refers to the possibility that
the counterparty will be unable and/or willing to honor its obligations and/or
default completely on the derivative transaction. Swap agreements also may be
considered to be illiquid. Further, there is a risk that no suitable
counterparties are willing to enter into, or continue to enter into,
transactions with the Fund and, as a result, the Fund may not be able to achieve
its investment objective.
Derivatives
Risk.
Derivatives and other similar instruments (referred to collectively as
“derivatives”) are financial instruments whose values are based on the value of
one or more reference assets or indicators, such as a security, currency,
interest rate, or index. The Fund’s use of derivatives involves risks different
from, and possibly greater than, the risks associated with investing directly in
securities and other more traditional investments. Moreover, although the value
of a derivative is based on an underlying asset or indicator, a derivative
typically does not carry the same rights as would be the case if the Fund
invested directly in the underlying securities, currencies or other
assets.
Derivatives
are subject to a number of risks, such as potential changes in value in response
to market developments or, in the case of “over-the-counter” derivatives, as a
result of a counterparty’s credit quality and the risk that a derivative
transaction may not have the effect the Adviser anticipated. Derivatives also
involve the risk of mispricing or improper valuation and the risk that changes
in the value of a derivative may not achieve the desired correlation with the
underlying asset or indicator. Derivative transactions can create investment
leverage and may be highly volatile, and the Fund could lose more than the
amount it invests. The use of derivatives may increase the amount and affect the
timing and character of taxes payable by shareholders of the Fund.
Many
derivative transactions are entered into “over-the-counter” without a central
clearinghouse; as a result, the value of such a derivative transaction will
depend on, among other factors, the ability and the willingness of the Fund’s
counterparty to perform its obligations under the transaction. If a counterparty
were to default on its obligations, the Fund’s contractual remedies against such
counterparty may be subject to bankruptcy and insolvency laws, which could
affect the Fund’s rights as a creditor (e.g.,
the Fund may not receive the net amount of payments that it is contractually
entitled to receive). Counterparty risk also refers to the related risks of
having concentrated exposure to such a counterparty. A liquid secondary market
may not always exist for the Fund’s derivative positions at any time, and the
Fund may not be able to initiate or liquidate a swap position at an advantageous
time or price, which may result in significant losses. The Fund may also face
the risk that it may not be able to meet margin and payment requirements and
maintain a derivatives position.
Derivatives
are also subject to operational and legal risks. Operational risk generally
refers to risk related to potential operational issues, including documentation
issues, settlement issues, system failures, inadequate controls, and human
errors. Legal risk generally refers to insufficient documentation, insufficient
capacity or authority of counterparty, or legality or enforceability of a
contract.
Energy
Commodity Sector Risk. The
performance of the Fund in part is linked to the daily performance of the spot
price of certain energy-related commodities such as crude oil. The market values
of such commodities are strongly affected by the supply of, and demand for,
those commodities, as well as, among other factors, capital expenditures on
exploration and production, energy conservation efforts, government regulation
and subsidization, world event, technological advances and general economic
conditions. Therefore, energy commodities are subject to swift price
fluctuations, and investments in such commodities can be
cyclical
and/or highly volatile. Additionally, significant declines in the price of oil
may contribute to significant market volatility, which may materially adversely
affect the Fund’s performance.
Gap
Risk. The
Fund and the Subsidiary are subject to the risk that a commodity price will
fluctuate even during periods when there is no trading. Usually, such movements
occur when there are adverse news announcements, which can cause a commodity
price to drop substantially from the previous day’s closing price.
Interest Rate Risk.
Debt securities and preferred securities are subject to interest rate risk.
Interest rate risk refers to fluctuations in the value of a security resulting
from changes in the general level of interest rates. When the general level of
interest rates goes up, the prices of most debt securities and certain preferred
securities go down. When the general level of interest rates goes down, the
prices of most debt securities go up. Many factors can cause interest rates to
rise, including central bank monetary policy, rising inflation rates and general
economic conditions. Debt securities with longer durations tend to be more
sensitive to interest rate changes, usually making them more volatile than debt
securities, such as bonds, with shorter durations. A substantial investment by
the Fund in debt securities with longer-term maturities during periods of rising
interest rates may cause the value of the Fund’s investments to decline
significantly. Changing interest rates may have unpredictable effects on
markets, may result in heightened market volatility and may detract from Fund
performance to the extent the Fund is exposed to such interest rates and/or
volatility. It is difficult to predict the magnitude, timing or direction of
interest rate changes and the impact these changes will have on the markets in
which the Fund invests.
Market
Risk.
The prices of securities are subject to the risks associated with investing in
the securities market, including general economic conditions, sudden and
unpredictable drops in value, exchange trading suspensions and closures and
public health risks. These risks may be magnified if certain social, political,
economic and other conditions and events (such as natural disasters, epidemics
and pandemics, terrorism, conflicts and social unrest) adversely interrupt the
global economy; in these and other circumstances, such events or developments
might affect companies world-wide. Overall securities values could decline
generally or underperform other investments. An investment may lose
money.
Metals
Commodity Sector Risk.
The
performance of the Fund in part is linked to the daily performance of the spot
price of certain industrial and precious metals, including aluminum, copper,
gold, silver and zinc. Investments in metals may be highly volatile and can
change quickly and unpredictably due to a number of factors, including the
supply and demand of each metal, environmental or labor costs, political, legal,
financial, accounting and tax matters and other events that the Fund cannot
control. In addition, changes in international monetary policies or economic and
political conditions can affect the supply of metals, and consequently the value
of metal investments. The United States or foreign governments may pass laws or
regulations limiting metal investments for strategic or other policy reasons.
Further, the principal supplies of metal industries may be concentrated in a
small number of countries and regions. Consequently, the price of a metal held
by the Fund could decline, which would adversely affect the Fund’s
performance.
Money
Market Funds Risk. Although
a money market fund is designed to be a relatively low risk investment, it is
subject to certain risks. An investment in a money market fund is not a bank
account and is not insured or guaranteed by a Federal Deposit Insurance
Corporation or any other government agency. Although money market funds seek to
maintain a net asset value of $1.00 per share, it is possible that the Fund may
lose money by investing in a money market fund.
Operational
Risk.
The Fund is exposed to operational risk arising from a number of factors,
including human error, processing and communication errors, errors of the Fund’s
service providers, counterparties or other third-parties, failed or inadequate
processes and technology or system failures.
Passive
Management Risk.
Unlike
many investment companies, the Fund is not “actively” managed. Therefore, unless
a specific security/asset is removed from its Index, the Fund generally would
not sell such a security/asset because the security’s issuer/asset is in
financial trouble. If a specific security/asset is removed from the Fund’s
Index, the Fund may be forced to sell such security/asset at an inopportune time
or for prices other than at current market values. An investment in the Fund
involves risks similar to those of investing in any fund that invests in a
similar asset class, such as market fluctuations caused by such factors as
economic and political developments, changes in interest rates and perceived
trends in security/asset prices. The Fund’s Index may not contain the
appropriate or a diversified mix of securities and/or assets for any particular
economic cycle. The timing of changes in the composition of the Fund’s portfolio
in seeking to track its Index could have a negative effect on the Fund. Unlike
with an actively managed fund, the Adviser does not use techniques or defensive
strategies designed to lessen the effects of market volatility or to reduce the
impact of periods of market decline. Additionally, unusual market conditions may
cause the Fund’s Index provider to postpone a scheduled rebalance or
reconstitution, which could cause the Fund’s Index to vary from its normal or
expected composition. This means that, based on market and economic conditions,
the Fund’s performance could be lower than funds that may actively shift their
portfolio assets to take advantage of market opportunities or to lessen the
impact of a market decline or a decline in the value of one or more
issuers.
Regulatory
Risk. Changes
in the laws or regulations of the United States, including any changes to
applicable tax laws and regulations, could impair the ability of the Fund to
achieve its investment objective and could increase the operating expenses of
the Fund. The Adviser is registered as a commodity pool operator under Commodity
Exchange Act and the rules of the CFTC and is subject to CFTC regulation with
respect to the Fund. The CFTC has adopted rules regarding the disclosure,
reporting and recordkeeping requirements that will apply with respect to the
Fund as a result of the Adviser’s registration as a commodity pool
operator.
Generally, these rules allow for substituted compliance with CFTC disclosure and
shareholder reporting requirements, based on the Adviser’s compliance with
comparable Securities and Exchange Commission requirements. This means that for
most of the CFTC’s disclosure and shareholder reporting applicable to the
Adviser as the Fund’s commodity pool operator, the Adviser’s compliance with
Securities and Exchange Commission disclosure and shareholder reporting will be
deemed to fulfill the Adviser’s CFTC compliance obligations. However, as a
result of CFTC regulation with respect to the Fund, the Fund may incur
additional compliance and other expenses. The Adviser is also registered as a
CTA but relies on an exemption with respect to the Fund from CTA regulations
available for a CTA that also serves as the Fund’s commodity pool operator. The
CFTC has neither reviewed nor approved the Fund, their investment strategies, or
this Prospectus.
Repurchase
Agreements Risk.
In
a repurchase agreement, the Fund acquires a security for a short time while
agreeing to sell it back at a designated price and time. The agreement creates a
fixed rate of return not subject to market fluctuations. In a reverse repurchase
agreement, the Fund sells a security subject to the obligation of a buyer to
resell and the Fund to repurchase such security at a fixed time and price The
Fund enters into these agreements generally with member banks of the Federal
Reserve System or certain non-bank dealers; these counterparties collateralize
the transaction.
A
repurchase agreement exposes the Fund to the risk that the party that sells the
security may default on its obligation to repurchase it. The Fund may lose money
if it cannot sell the security at the agreed-upon time and price or the security
loses value before it can be sold. A reverse repurchase agreement involves the
risk that the market value of the securities the Fund is obligated to repurchase
under the agreement may decline below the repurchase price. In the event the
buyer of securities under a reverse repurchase agreement files for bankruptcy or
becomes insolvent, the Fund’s use of proceeds of the agreement may be restricted
pending a determination by the other party, or its trustee or receiver, whether
to enforce the Fund’s obligation to repurchase the securities.
Subsidiary
Investment Risk.
Changes in the laws of the United States and/or the Cayman Islands, under which
the Fund and the Subsidiary are organized, respectively, could result in the
inability of the Fund to operate as intended and could negatively affect the
Fund and its shareholders. The Subsidiary is not registered under the Investment
Company Act of 1940 and is not subject to the investor protections of the
Investment Company Act of 1940. Thus, the Fund, as an investor in the
Subsidiary, will not have all the protections offered to investors in registered
investment companies.
Tax
Risk (with respect to investments in the Subsidiary).
The Fund must derive at least 90% of its gross income from certain qualifying
sources of income in order to qualify as a regulated investment company under
the Internal Revenue Code of 1986. The Internal Revenue Service issued a revenue
ruling in December 2005, which concluded that income and gains from certain
commodity-linked derivatives are not qualifying income under Subchapter M of the
Internal Revenue Code of 1986. As a result, the Fund’s ability to invest
directly in commodity-linked futures contracts or swaps or in certain
exchange-traded trusts that hold commodities as part of its investment strategy
is limited by the requirement that it receive no more than ten percent (10%) of
its gross income from such investments. However, in Revenue Ruling 2006-31, the
Internal Revenue Service indicated that income from alternative investment
instruments that create commodity exposure may be considered qualifying income
under the Internal Revenue Code of 1986. The Internal Revenue Service
subsequently issued private letter rulings to other taxpayers in which the
Internal Revenue Service specifically concluded that that income derived from a
fund’s investment in a controlled foreign corporation also will constitute
qualifying income to the fund, even if the controlled foreign corporation itself
owns commodity-linked futures contracts or swaps. The Fund expects to invest its
assets in the Subsidiary, consistent with applicable law and the advice of
counsel, in a manner that should permit the Fund to treat income allocable from
the Subsidiary as qualifying income. The Internal Revenue Service has issued
regulations that treat a fund’s income inclusion with respect to an investment
in a non-U.S. company generating investment income as qualifying income if there
is a current-year distribution out of the earnings and profits of the non-U.S.
company that are attributable to such income inclusion or if the income from the
Subsidiary is related to the Fund's business of investing. The Fund intends to
treat its income from the Subsidiary as qualifying income. There can be no
assurance that the Internal Revenue Service will not change its position with
respect to some or all of these issues or if the Internal Revenue Service did
so, that a court would not sustain the Internal Revenue Service’s position.
Furthermore, the tax treatment of the Fund’s investments in the Subsidiary may
be adversely affected by future legislation, court decisions, future Internal
Revenue Service guidance or Treasury regulations. If the Internal Revenue
Service were to change its position or otherwise determine that income derived
from the Fund’s investment in the Subsidiary does not constitute qualifying
income and if such positions were upheld, or if future legislation, court
decisions, future Internal Revenue Service guidance or Treasury regulations were
to adversely affect the tax treatment of such investments, the Fund might cease
to qualify as a regulated investment company and would be required to reduce its
exposure to such investments which could result in difficulty in implementing
its investment strategy. If the Fund did not qualify as a regulated investment
company for any taxable year, the Fund’s taxable income would be subject to tax
at the Fund level at regular corporate tax rates (without reduction for
distributions to shareholders) and to a further tax at the shareholder level
when such income is distributed. In such event, in order to re-qualify for
taxation as a regulated investment company, the Fund may be required to
recognize unrealized gains, pay substantial taxes and interest and make certain
distributions.
U.S.
Treasury Securities Risk.
Direct obligations of the U.S. Treasury have historically involved little risk
of loss of principal if held to maturity. However, due to fluctuations in
interest rates, the market value of such securities may vary.
3.
ADDITIONAL INVESTMENT STRATEGIES
INVESTING
DEFENSIVELY
The
Fund may take temporary defensive positions that are inconsistent with the
Fund’s principal investment strategies in anticipation of or in an attempt to
respond to adverse market, economic, political or other conditions. The Fund may
not achieve its investment objective while it is investing
defensively.
SECURITIES
LENDING
The
Fund may lend its securities as permitted under the Investment Company Act of
1940 (the “1940 Act”), including by participating in securities lending programs
managed by broker-dealers or other institutions. Securities lending allows the
Fund to retain ownership of the securities loaned and, at the same time, earn
additional income. The borrowings must be collateralized in full with cash, U.S.
government securities or high-quality letters of credit.
The
Fund could experience delays and costs in recovering the securities loaned or in
gaining access to the securities lending collateral. If the Fund is not able to
recover the securities loaned, the Fund may sell the collateral and purchase a
replacement investment in the market. The value of the collateral could decrease
below the value of the replacement investment by the time the replacement
investment is purchased. Cash received as collateral and which is invested is
subject to market appreciation and depreciation.
4.
OTHER INFORMATION AND POLICIES
BENEFICIARIES
OF CONTRACTUAL ARRANGEMENTS
VanEck
Funds (the “Trust”) enters into contractual arrangements with various parties,
including, among others, the Fund’s investment adviser, administrator and
distributor, who provide services to the Fund. Shareholders of the Fund are not
parties to, or intended (or “third-party”) beneficiaries of, any of those
contractual arrangements, and those contractual arrangements are not intended to
create in any individual shareholder or group of shareholders any right to
enforce such contractual arrangements against the service providers or to seek
any remedy under such contractual arrangements against the service providers,
either directly or on behalf of the Trust.
This
prospectus provides information concerning the Trust and the Fund that you
should consider in determining whether to purchase shares of the Fund. None of
this prospectus, the SAI or any document filed as an exhibit to the Trust’s
registration statement, is intended to, nor does it, give rise to an agreement
or contract between the Trust or the Fund and any investor, or give rise to any
contract or other rights in any individual shareholder, group of shareholders or
other person other than any rights conferred explicitly by federal or state
securities laws that may not be waived.
OVERVIEW
OF THE CMCI
The
CMCI represents a basket of commodity futures contracts with 29 commodity
components (as of February 29, 2024). Exposure to each component is allocated
across a range of maturities ranging from three months up to a maximum of about
three years. Not all commodities have the full range of maturity exposures. In
contrast, traditional commodity indices typically invest in front-month futures
contracts which have shorter tenors (time to maturity) than the average CMCI
tenor.
The
CMCI also employs a “constant maturity” approach by relying on a continuous roll
methodology in which the CMCI invests in and out of future contracts on a daily
basis. This methodology differs from traditional commodity indices, which
usually are pre-defined to roll during a fixed window of days on a monthly or
bi-monthly basis. The CMCI represents commodities in five primary sectors:
energy, precious metals, industrial metals, agriculture and livestock. The
underlying commodities trade on various exchanges.
The
return of the Index is generated by two components: (i) uncollateralized returns
from holding and rolling of futures contracts comprising the Index and (ii) the
fixed income return reflecting the Secured Overnight Financing Rate
(“SOFR”)-based interest earned on a hypothetical portfolio theoretically
deposited as full collateral for the notional exposure of hypothetical positions
in the futures contracts comprising the Index.
CYBER
SECURITY
The
Fund and its service providers are susceptible to cyber security risks that
include, among other things, theft, unauthorized monitoring, release, misuse,
loss, destruction or corruption of confidential and highly restricted data;
denial of service attacks; unauthorized access to relevant systems; compromises
to networks or devices that the Fund and its service providers use to service
the Fund’s operations; and operational disruption or failures in the physical
infrastructure or operating systems that support the Fund and its service
providers. Cyber attacks against or security breakdowns of the Fund or its
service providers may adversely impact the Fund and its shareholders,
potentially resulting in, among other things, financial losses; the inability of
Fund shareholders to transact business and the Fund to process transactions; the
inability to calculate the Fund’s net asset value; violations of applicable
privacy and other laws; regulatory fines, penalties, reputational damage,
reimbursement or other compensation costs; and/or additional compliance costs.
The Fund may incur additional costs for cyber security risk management and
remediation purposes. In addition, cyber security risks may also impact issuers
of securities in which the Fund invests, which may cause the Fund’s investments
in such issuers to lose value. There can be no assurance that the Fund or its
service providers will not suffer losses relating to cyber attacks or other
information security breaches in the future.
PORTFOLIO
HOLDINGS INFORMATION
Generally,
it is the Fund’s and the Adviser’s policy that no current or potential investor,
including any Fund shareholder, shall be provided information about the Fund’s
portfolio on a preferential basis in advance of the provision of that
information to other investors. A complete description of the Fund’s policies
and procedures with respect to the disclosure of the Fund’s portfolio securities
is available in the Fund’s statement of additional information
(“SAI”).
Portfolio
information for the Fund is available to all investors on the VanEck website at
vaneck.com. Information regarding the Fund’s sector weightings, updated as of
each month-end, is also located on this website. Generally, this information is
posted to the website within 10 business days of the end of the applicable
month. This information generally remains available on the website until new
information is posted. The Fund reserves the right to exclude any portion of
this portfolio information from publication when deemed in the best interest of
the Fund, and to discontinue the posting of portfolio information at any time,
without prior notice.
PORTFOLIO
INVESTMENTS
The
percentage limitations relating to the composition of the Fund’s portfolio apply
at the time the Fund acquires an investment. A subsequent increase or decrease
in percentage resulting from a change in the value of portfolio securities or
the total or net assets of the Fund will not be considered a violation of the
restriction.
|
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III.
SHAREHOLDER INFORMATION |
1.
HOW TO BUY, SELL, EXCHANGE OR TRANSFER SHARES
The
Fund offers Class A, Class I and Class Y shares. Information related to how to
buy, sell, exchange and transfer shares is discussed below. See the “Minimum
Purchase” section for information related to initial and subsequent minimum
investment amounts. The minimum investment amounts vary by share
class.
Through
a Financial Intermediary
Primarily,
accounts are opened through a financial intermediary (broker, bank, adviser or
agent). Please contact your financial intermediary for details.
Through
the Transfer Agent, SS&C GIDS, Inc. (SS&C)
You
may buy (purchase), sell (redeem), exchange, or transfer ownership of Class A
and Class I shares directly through SS&C by mail or telephone, as stated
below. For Class Y shares, shareholders must open accounts and transact business
through a financial intermediary.
The
Fund’s mailing address at SS&C is:
VanEck
Funds
P.O.
Box 218407
Kansas
City, MO 64121-8407
For
overnight delivery:
VanEck
Funds
430
W 7th St., Suite 218407
Kansas
City, MO 64105-1407
Non-resident
aliens cannot make a direct investment to establish a new account in the Fund,
but may invest through their broker or agent.
To
telephone the Fund at SS&C, call VanEck Account Assistance at
800-544-4653.
Purchase
by Mail
To
make an initial purchase, complete the VanEck Account Application and mail it
with your check made payable to VanEck Funds. Subsequent purchases can be made
by check with the remittance stub of your account statement. You cannot make a
purchase by telephone. We cannot accept third party checks, starter checks,
money orders, travelers checks, cashier checks, checks drawn on a foreign bank,
or checks not in U.S. dollars. There are separate applications for VanEck
retirement accounts (see “Retirement Plans” for details). For further details,
see the application or call Account Assistance.
Telephone
Redemption-Proceeds by Check 800-544-4653
If
your account has the optional Telephone Redemption Privilege, you can redeem up
to $50,000 per day. The redemption check must be payable to the registered
owner(s) at the address of record (which cannot have been changed within the
past 30 days). You automatically get the Telephone Redemption Privilege (for
eligible accounts) unless you specifically refuse it on your Account
Application, on broker/agent settlement instructions, or by written notice to
SS&C. All accounts are eligible for the privilege except those registered in
street, nominee, or corporate name and custodial accounts held by a financial
institution, including VanEck sponsored retirement plans.
Expedited
Redemption—Proceeds by Wire 800-544-4653
If
your account has the optional Expedited Redemption Privilege, you can redeem a
minimum of $1,000 or more per day by telephone or written request with the
proceeds wired to your designated bank account. The Fund reserves the right to
waive the minimum amount. This privilege must be established in advance by
Application. For further details, see the Application or call Account
Assistance.
Written
Redemption
Your
written redemption (sale) request must include:
■ Fund
and account number.
■ Number
of shares or dollar amount to be redeemed, or a request to sell “all shares.”
■ Signatures
of all registered account holders, exactly as those names appear on the account
registration, including any additional documents concerning authority and
related matters in the case of estates, trusts, guardianships, custodianships,
partnerships and corporations, as requested by SS&C.
■ Special
instructions, including bank wire information or special payee or address.
A
signature guarantee for each account holder will be required if:
■ The
redemption is for $50,000 or more.
■ The
redemption amount is wired.
■ The
redemption amount is paid to someone other than the registered owner.
■ The
redemption amount is sent to an address other than the address of record.
■ The
address of record has been changed within the past 30 days.
Institutions
eligible to provide signature guarantees include banks, brokerages, trust
companies, and some credit unions.
Telephone
Exchange 800-544-4653
If
your account has the optional Telephone Exchange Privilege, you can exchange
between VanEck Funds of the same Class without any additional sales charge. All
accounts are eligible except for omnibus accounts or those registered in street
name and certain custodial retirement accounts held by a financial institution
other than VanEck. For further details regarding exchanges, please see the
application, “Limits and Restrictions” and “Unauthorized Telephone Requests”
below, or call Account Assistance.
Written
Exchange
Written
requests for exchange must include:
■ The
fund and account number to be exchanged out of.
■ The
fund to be exchanged into.
■ Directions
to exchange “all shares” or a specific number of shares or dollar amount.
■ Signatures
of all registered account holders, exactly as those names appear on the account
registration, including any additional documents concerning authority and
related matters in the case of estates, trusts, guardianships, custodianships,
partnerships and corporations, as requested by SS&C.
For
further details regarding exchanges, please see the applicable information in
“Telephone Exchange.”
Certificates
Certificates
are not issued for new or existing shares.
Transfer
of Ownership
Requests
must be in writing and provide the same information and legal documentation
necessary to redeem and establish an account, including the social security or
tax identification number of the new owner.
Redemption
Liquidity
The
Fund expects to make redemption payments to the shareholder, or shareholder’s
financial intermediary, within 1 to 2 business days following the Fund’s receipt
of the redemption transaction from the shareholder, or shareholder’s financial
intermediary. The financial intermediary acts on behalf of the shareholder and
is responsible for transmitting redemption proceeds to the shareholder. Payment
of redemption proceeds by the Fund may take longer than the time the Fund
typically expects and may take up to 7 days as permitted by the 1940
Act.
Typically,
redemption payments of Fund shares will be made in U.S. dollars. The Fund
generally expects to satisfy redemption requests from available cash holdings
and sale of portfolio securities. On a less regular basis, the Fund also may
draw on a bank line of credit to meet redemption requests. In stressed market
conditions or for a particularly large redemption, the Fund also reserves the
right to meet redemption requests through a “redemption in kind” as described
below.
Redemption
in Kind
The
Fund reserves the right to satisfy redemption requests by making payment in
securities (known as a redemption in kind). Redemptions in kind are not
routinely used by the Fund. The Fund may, however, use redemptions in kind
during particularly stressed market conditions or to manage the impact of a
large redemption on the Fund. In such case, the Fund may pay all or part of the
redemption in securities of equal value as permitted under the 1940 Act, and the
rules thereunder. The redeeming shareholder should expect to incur transaction
costs upon the disposition of the securities received and will bear any market
risks associated with such securities until they are converted into cash. A
redemption in kind is treated as a taxable transaction and a sale of the
redeemed shares, generally resulting in capital gain or loss to the redeeming
shareholder subject to certain loss limitation rules.
Redemptions
Initiated by the Fund
The
Fund reserves the right to redeem your shares in the Fund if the Fund’s Board
determines that the failure to so redeem may have materially adverse
consequences to the shareholders of the Fund. For additional information, please
see “Additional Purchase and Redemption Information—Redemptions Initiated by the
Fund” in the SAI.
LIMITS
AND RESTRICTIONS
Frequent
Trading Policy
The
Board has adopted policies and procedures reasonably designed to deter frequent
trading in shares of the Fund, commonly referred to as “market timing,” because
such activities may be disruptive to the management of the Fund’s portfolio and
may increase the Fund’s expenses and negatively impact the Fund’s performance.
As such, the Fund may reject a purchase or exchange transaction or restrict an
account from investing in the Fund for any reason if the Adviser, in its sole
discretion, believes that a shareholder is engaging in market timing activities
that may be harmful to the Fund. The Fund discourages and does not accommodate
frequent trading of shares by its shareholders.
The
Fund may invest in securities of foreign issuers, and consequently may be
subject to an increased risk of frequent trading activities because frequent
traders may attempt to take advantage of time zone differences between the
foreign markets in which the Fund’s portfolio securities trade and the time as
of which the Fund’s net asset value is calculated (“time-zone arbitrage”). The
Fund’s investments in other types of securities may also be susceptible to
frequent trading strategies. These investments include securities that are,
among other things, thinly traded, traded infrequently, or relatively illiquid,
which have the risk that the current market price for the securities may not
accurately reflect current market values. The Fund has adopted fair valuation
policies and procedures intended to reduce the Fund’s exposure to potential
price arbitrage. However, there is no guarantee that the Fund’s net asset value
will immediately reflect changes in market conditions.
The
Fund uses a variety of techniques to monitor and detect abusive trading
practices, such as monitoring purchases, redemptions and exchanges that meet
certain criteria established by the Fund, and making inquiries with respect to
such trades. If a transaction is rejected or an account restricted due to
suspected market timing, the investor or his or her financial adviser will be
notified.
With
respect to trades that occur through omnibus accounts at intermediaries, such as
broker-dealers and third party administrators, the Fund requires all such
intermediaries to agree to cooperate in identifying and restricting market
timers in accordance with the Fund’s policies and will periodically request
customer trading activity in the omnibus accounts based on certain criteria
established by the Fund. There is no assurance that the Fund will request such
information with sufficient frequency to detect or deter excessive trading or
that review of such information will be sufficient to detect or deter excessive
trading in omnibus accounts effectively.
Although
the Fund will use reasonable efforts to prevent market timing activities in the
Fund’s shares, there can be no assurances that these efforts will be successful.
As some investors may use various strategies to disguise their trading
practices, the Fund’s ability to detect frequent trading activities by investors
that hold shares through financial intermediaries may be limited by the ability
and/or willingness of such intermediaries to monitor for these
activities.
For
further details, contact Account Assistance.
Unauthorized
Telephone Requests
Like
most financial organizations, VanEck, the Fund and SS&C may only be liable
for losses resulting from unauthorized transactions if reasonable procedures
designed to verify the caller’s identity and authority to act on the account are
not followed.
If
you do not want to authorize the Telephone Exchange or Redemption privilege on
your eligible account, you must refuse it on the Account Application,
broker/agent settlement instructions, or by written notice to SS&C. VanEck,
the Fund, and SS&C reserve the right to reject a telephone redemption,
exchange, or other request without prior notice either during or after the call.
For further details, contact Account Assistance.
AUTOMATIC
SERVICES
Automatic
Investment Plan
You
may authorize SS&C to periodically withdraw a specified dollar amount from
your bank account and buy shares in your Fund account. For further details and
to request an Application, contact Account Assistance.
Automatic
Exchange Plan
You
may authorize SS&C to periodically exchange a specified dollar amount for
your account from one Fund to another Fund. For further details and to request
an Application, contact Account Assistance.
Automatic
Withdrawal Plan
You
may authorize SS&C to periodically withdraw (redeem) a specified dollar
amount from your Fund account and mail a check to you for the proceeds. Your
Fund account must be valued at $10,000 or more at the current offering price to
establish the Plan. For further details and to request an Application, contact
Account Assistance.
MINIMUM
PURCHASE
Each
class can set its own transaction minimums and may vary with respect to expenses
for distribution, administration and shareholder services.
For
Class A and Class Y shares, an initial purchase of $1,000 and subsequent
purchases of $100 or more are required for non-retirement accounts. There are no
purchase minimums for any retirement or pension plan account, for any account
using the Automatic Investment Plan, or for any other periodic purchase program.
Minimums may be waived for initial and subsequent purchases through “wrap fee”
and similar programs offered without a sales charge by certain financial
institutions and third-party recordkeepers and/or administrators.
For
Class I shares, an initial purchase by an eligible investor of $1 million is
required. The minimum initial investment requirement may be waived or aggregated
among investors, in the Adviser’s discretion, for investors in certain
fee-based, wrap or other no-load investment programs, and for an eligible
Employer-Sponsored Retirement Plan with plan assets of $3 million or more,
sponsored by financial intermediaries that have entered into a Class I agreement
with VanEck, as well as for other categories of investors. An
“Employer-Sponsored Retirement Plan” includes (a) an employer sponsored pension
or profit sharing plan that qualifies (a “Qualified Plan”) under section 401(a)
of the Code, including Code section 401(k), money purchase pension, profit
sharing and defined benefit plans; (b) an ERISA-covered 403(b) plan; and (c)
certain non-qualified deferred compensation arrangements that operate in a
similar manner to a Qualified Plan, such as 457 plans and executive deferred
compensation arrangements, but not including employer-sponsored IRAs. In
addition, members of the Boards of Trustees of VanEck Funds and VanEck VIP Trust
and each officer, director and employee of VanEck may purchase Class I shares
without being subject to the $1 million minimum initial investment requirement.
There are no minimum investment requirements for subsequent purchases to
existing accounts. To be eligible to purchase Class I shares, you must also
qualify as specified in “How to Choose a Class of Shares.”
ACCOUNT
VALUE AND REDEMPTION
If
the value of your account falls below $1,000 for Class A and Class Y shares and
below $500,000 for Class I shares after the initial purchase, the Fund reserves
the right to redeem your shares after 30 days notice to you. This
does not apply to accounts exempt from purchase minimums as described
above.
HOW
THE FUND SHARES ARE PRICED
The
Fund buys or sells its shares at its net asset value, or NAV, per share next
determined after receipt of a purchase or redemption plus any applicable sales
charge. The Fund calculates its NAV per share class every day the New York Stock
Exchange (NYSE) is open, as of the close of regular trading on the NYSE, which
is normally 4:00 p.m. Eastern Time. The Fund's daily NAV is available at
vaneck.com.
You
may enter a buy or sell order when the NYSE is closed for weekends or holidays.
If that happens, your price will be the NAV calculated as of the close of the
next regular trading session of the NYSE. The Fund may invest in certain
securities which are listed on foreign exchanges that trade on weekends or other
days when the Fund does not price its shares. As a result, the NAV of the Fund’s
shares may change on days when shareholders will not be able to purchase or
redeem shares.
The
Fund’s investments are generally valued based on market quotations which may be
based on quotes obtained from a quotation reporting system, established market
makers, broker dealers or by an independent pricing service. Short-term debt
investments having a maturity of 60 days or less are valued at amortized cost,
which approximates the fair value of the security. Assets or liabilities
denominated in currencies other than the U.S. dollar are converted into U.S.
dollars at the current market rates on the date of valuation as quoted by one or
more sources. When market quotations are not readily available for a portfolio
security or other asset, or, in the opinion of the Adviser, are deemed
unreliable, the Fund will use the security’s or asset’s “fair value” as
determined in good faith in accordance with the Fund’s Fair Value Pricing
Policies and Procedures, which have been approved by the Board. As a general
principle, the current fair value of a security or other asset is the amount
which the Fund might reasonably expect to receive for the security or asset upon
its current sale. The Fund’s Pricing Committee, whose members are selected by
the senior management of the Adviser and reported to the Board, is responsible
for recommending fair value procedures to the Board and for administering the
process used to arrive at fair value prices.
Factors
that may cause the Fund’s Pricing Committee to fair value a security include,
but are not limited to: (1) market quotations are not readily available because
a portfolio security is not traded in a public market, trading in the security
has been suspended, or the principal market in which the security trades is
closed, (2) trading in a portfolio security is limited or suspended and not
resumed prior to the time at which the Fund calculates its NAV, (3) the market
for the relevant security is thin, or the price for the security is “stale”
because its price has not changed for five consecutive business days, (4) the
Adviser determines that a market quotation is not reliable, for example, because
price movements are highly volatile and cannot be verified by a reliable
alternative pricing source, or (5) a significant event affecting the value of a
portfolio security is determined to have occurred between the time of the market
quotation provided for a portfolio security and the time at which the Fund
calculates its NAV.
In
determining the fair value of securities, the Pricing Committee will consider,
among other factors, the fundamental analytical data relating to the security,
the nature and duration of any restrictions on the disposition of the security,
and the forces influencing the market in which the security is
traded.
Foreign
equity securities in which the Fund may invest may be traded in markets that
close before the time that the Fund calculates its NAV. Foreign equity
securities are normally priced based upon the market quotation of such
securities as of the close of their respective principal markets, as adjusted to
reflect the Adviser’s determination of the impact of events, such as a
significant
movement in the U.S. markets occurring subsequent to the close of such markets
but prior to the time at which the Fund calculates its NAV. In such cases, the
Pricing Committee may apply a fair valuation formula to those foreign equity
securities based on the Committee’s determination of the effect of the U.S.
significant event with respect to each local market.
Certain
of the Fund’s portfolio securities are valued by an independent pricing service
approved by the Board. The independent pricing service may utilize an automated
system incorporating a model based on multiple parameters, including a
security’s local closing price (in the case of foreign securities), relevant
general and sector indices, currency fluctuations, and trading in depositary
receipts and futures, if applicable, and/or research evaluations by its staff,
in determining what it believes is the fair valuation of the portfolio
securities valued by such independent pricing service.
There
can be no assurance that the Fund could purchase or sell a portfolio security or
other asset at the price used to calculate the Fund’s NAV. Because of the
inherent uncertainty in fair valuations, and the various factors considered in
determining value pursuant to the Fund’s fair value procedures, there can be
material differences between a fair value price at which a portfolio security or
other asset is being carried and the price at which it is purchased or sold.
Furthermore, changes in the fair valuation of portfolio securities or other
assets may be less frequent, and of greater magnitude, than changes in the price
of portfolio securities or other assets valued by an independent pricing
service, or based on market quotations.
2.
HOW TO CHOOSE A CLASS OF SHARES
The
Fund offers three classes of shares with different sales charges and 12b-1 fee
schedules, designed to provide you with different purchase options according to
your investment needs. Class A shares are offered to the general public. Class I
shares are offered to eligible investors primarily through certain financial
intermediaries that have entered into a Class I Agreement with VanEck. The Fund
reserves the right to accept direct investments by eligible investors. Class Y
shares are offered only to investors through “wrap fee” and similar programs
offered without a sales charge by certain financial intermediaries and
third-party recordkeepers and/or administrators that have entered into a Class Y
agreement with VanEck.
Financial
intermediaries making Fund shares available to their clients determine which
share class(es) to make available. Your financial intermediary may receive
different compensation for selling one class of shares than for selling another
class, which may depend on, among other things, the type of investor account and
the policies, procedures and practices adopted by your financial intermediary.
You should review these arrangements with your financial
intermediary.
■ CLASS
A Shares
are offered at net asset value plus an initial sales charge at time of purchase
of up to 5.75% of the public offering price. The initial sales charge is reduced
for purchases of $25,000 or more. For further information regarding sales
charges, breakpoints and other discounts, please see below. The 12b-1 fee is
0.25% annually.
■ CLASS
I Shares
are offered with no sales charges on purchases, no contingent deferred
redemption charge (“CDRC”), and no 12b-1 fee. To be eligible to purchase Class I
(Institutional) shares, you must be an eligible investor that is making or has
made a minimum initial investment of at least $1 million (which may be reduced
or waived under certain circumstances) in Class I shares of the Fund. Eligible
investors in Class I shares include corporations, foundations, family offices
and other institutional organizations; high net worth individuals; persons
purchasing through certain financial intermediaries or a bank, trust company or
similar institution investing for its own account or for the account of a client
when such institution has entered into a Class I agreement with VanEck and makes
Class I shares available to the client’s program or plan.
■ CLASS
Y Shares
are offered with no sales charges on purchases, no CDRC, and no 12b-1 fee. To be
eligible to purchase Class Y shares, you must be an eligible investor in a
“wrap-fee” or other fee-based program, including an Employer-Sponsored
Retirement Plan, offered through a financial intermediary that has entered into
a Class Y Agreement with VanEck, and makes Class Y shares available to that
program or plan. An “Employer-Sponsored Retirement Plan” includes (a) an
employer sponsored pension or profit sharing plan that qualifies (a “Qualified
Plan”) under section 401(a) of the Code, including Code section 401(k), money
purchase pension, profit sharing and defined benefit plans; (b) an ERISA-covered
403(b) plan; and (c) certain non-qualified deferred compensation arrangements
that operate in a similar manner to a Qualified Plan, such as 457 plans and
executive deferred compensation arrangements, but not including
employer-sponsored IRAs.
Financial
intermediaries may offer their clients more than one class of shares of the
Fund. Shareholders who own shares of one class of the Fund and who are eligible
to invest in another class of the same Fund may be eligible to convert their
shares from one class to the other. Shareholders no longer participating in a
fee-based program may be subject to conversion of their current class of shares
by their financial intermediary to another class of shares of the Fund having
expenses that may be higher than the expenses of their current class of shares.
The timing and implementation of such conversions are at the discretion of the
shareholder’s financial intermediary. For additional information, please contact
your financial intermediary or see “Class Conversions” in the SAI. Investors
should consider carefully a Fund’s share class expenses and applicable sales
charges and fees plus any separate transaction and other fees charged by such
intermediaries in connection with investing in each available share class before
selecting a share class. It is the responsibility of the financial intermediary
and the investor to choose the proper share class and notify SS&C or VanEck
of that share class at the time of each purchase. More information regarding
share class eligibility is available in the “How to Buy, Sell, Exchange, or
Transfer Shares” section of the prospectus and in “Purchase of Shares” in the
SAI.
3.
SALES CHARGES
Unless
you are eligible for a waiver, the public offering price you pay when you buy
Class A shares of the Fund is the net asset value (NAV) of the shares plus an
initial sales charge. A sales charge means that a portion of your initial
investment goes toward the sales charge and is not invested. The initial sales
charge varies depending upon the size of your purchase, as set forth below, and
a percentage is paid to the financial intermediary who sells your Class A
shares. No sales charge is imposed where Class A shares are issued to you
pursuant to the automatic investment of income dividends or capital gains
distribution. It is the responsibility of the financial intermediary to ensure
that the investor obtains the proper “breakpoint” discount. Class I and Class Y
do not have an initial sales charge. Class A does charge a contingent deferred
sales charge as set forth below.
Different
intermediaries may impose different sales charges (including potential
reductions in or waivers of sales charges) other than those listed below. Such
intermediary-specific sales charge variations are described in Appendix A to
this prospectus, entitled “Intermediary Sales Charge Discounts and Waivers.”
Appendix A is incorporated herein by reference (is legally a part of this
prospectus). Such intermediary-specific sales charge discounts and waivers may
not be available to purchasers whose accounts are not held at and traded by
their intermediary.
In
all instances, it is the purchaser’s responsibility to notify the Fund or the
purchaser’s financial intermediary at the time of purchase of any facts
qualifying the purchaser for sales charge discounts or waivers.
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| Class
A Shares Sales Charges |
|
| |
|
| Sales
Charge as a Percentage of |
| |
| Dollar
Amount of Purchase |
Offering Price |
Net
Amount Invested |
Percentage
to Brokers or Agents1 |
|
| Less
than $25,000 |
5.75% |
6.10% |
5.00% |
|
| $25,000
to less than $50,000 |
5.00% |
5.30% |
4.25% |
|
| $50,000
to less than $100,000 |
4.50% |
4.70% |
3.90% |
|
| $100,000
to less than $250,000 |
3.00% |
3.10% |
2.60% |
|
| $250,000
to less than $500,000 |
2.50% |
2.60% |
2.20% |
|
| $500,000
to less than $1,000,000 |
2.00% |
2.00% |
1.75% |
|
| $1,000,000
and over |
None2 |
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| |
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1 Brokers
or Agents who receive substantially all of the sales charge for shares they sell
may be deemed to be statutory underwriters.
2 The
Distributor may pay a Finder’s Fee of 1.00% to eligible brokers and agents on
qualified commissionable shares purchased at or above the $1 million breakpoint
level. Such shares may be subject to a 1.00% contingent deferred sales charge if
redeemed within one year from the date of purchase. For additional information,
see “Contingent Deferred Sales Charge for Class A Shares” below or contact the
Distributor or your financial intermediary.
CONTINGENT
DEFERRED SALES CHARGE FOR CLASS A SHARES
Class
A shares purchased at or above the $1 million breakpoint in accordance with the
sales load schedule identified above (referred to as “commissionable” shares)
that are redeemed within one year of purchase will be subject to a contingent
deferred sales charge (“CDSC”) in the amount of 1.00% of the lesser of the
current value of the shares redeemed or the original purchase price of such
shares. The CDSC will be paid to the Distributor as reimbursement for any
Finder’s Fee previously paid by the Distributor to an eligible broker or agent
at the time the commissionable shares were purchased and may be waived by the
Distributor if the original purchase did not result in the payment of a Finder’s
Fee. For purposes of calculating the CDSC, shares will be redeemed in the
following order: (1) first shares that are not subject to the CDSC (e.g.,
dividend reinvestment shares and other non-commissionable shares) and (2) then
other shares on a first in, first out basis. A CDSC will not be charged in
connection with an exchange of Class A shares into Class A shares of another
VanEck Fund; however, the shares received upon an exchange will be subject to
the CDSC if they are subsequently redeemed within one year of the date of the
original purchase (subject to the same terms and conditions described above).
For further details regarding eligibility for the $1 million breakpoint, please
see Section 3. “Sales Charges—Reduced or Waived Sales Charges”
below.
REDUCED
OR WAIVED SALES CHARGES
You
may qualify for a reduced or waived sales charge as stated below, or under other
appropriate circumstances. You (or your broker or agent) must notify SS&C or
VanEck at the time of each purchase or redemption whenever a reduced or waived
sales charge is applicable. The term “purchase” refers to a single purchase by
an individual (including spouse and children under age 21), corporation,
partnership, trustee, or other fiduciary for a single trust, estate, or
fiduciary account. For further details, see the SAI. The value of shares owned
by an individual in Class A and Class C of each of the VanEck Funds may be
combined for a reduced sales charge in Class A shares only.
In
order to obtain a reduced sales charge (i.e.,
breakpoint discount) or to meet an eligibility minimum, it will be necessary at
the time of purchase for you to inform your broker or agent (or SS&C or
VanEck, as applicable), of the existence of other accounts in which there are
holdings eligible to be aggregated to meet the sales load breakpoints or
eligibility minimums and of any facts qualifying the purchaser for sales charge
discounts or waivers.
The
Fund makes available information regarding applicable sales loads, breakpoint
discounts, reduced or waived sales charges and eligibility minimums, on their
website at vaneck.com, free of charge.
FOR
CLASS A SHARES
Right
of Accumulation
When
you buy shares, the amount you purchase will be combined with the value, at
current offering price, of any existing Fund shares you own. This total will
determine the sales charge level for which you qualify.
Your
purchases eligible for Right of Accumulation reduced sales charge (i.e.
breakpoint discount) include Class A shares purchased for individual accounts
registered in the name of:
■ You,
individually;
■ Your
“family member,” defined as your spouse (by marriage or by common law
marriage/civil union as recognized by applicable state or federal law) and your
children/step-children if under the age of 21;
■ You,
when you own shares jointly with another individual(s) who is a non-family
member;
■ You
or a family member acting as the trustee, custodian, or other acting fiduciary
title for a single trust, estate, or fiduciary account;
■ Your
sole ownership business or the sole ownership business of a family member on
which you or a family member are the authorized signer;
■ Trust
Grantor (a trust established by you or a family member who is acting as the
grantor of the trust);
■ Trust
Beneficiary (a trust established by you or a family member who is the beneficial
owner of the trust);
■ A
single corporation or partnership.
Combined
Purchases
The
combined amounts of your multiple purchases in the Fund on a single day
determines the sales charge level for which you qualify.
Letter
of Intent
If
you plan to make purchases of the Fund that are eligible for a right of
accumulation discount, as described above, within a 13 month period in Class A
shares that total an amount equal to a reduced sales charge level, you can
establish a Letter of Intent (LOI) for that amount. Under the LOI, your initial
and subsequent purchases during that period receive the sales charge level
applicable to that total amount. The amount of a purchase not originally made
pursuant to the LOI may be included under a backdated LOI executed within 90
days of such purchase (“accumulation credit”) to fulfill the LOI. For LOIs, out
of an initial purchase (or subsequent purchases if necessary), 5% of the
specified dollar amount of an LOI will be held in escrow by SS&C in a
shareholder’s account until the shareholder’s total purchases of the Funds
pursuant to the LOI plus a shareholder’s accumulation credit (if any) equal the
amount specified in the Letter. For further details, see the Application and the
SAI.
Persons
Affiliated with VanEck
Trustees,
officers, and full-time employees (and their families) of the Fund, Adviser or
Distributor may buy without a sales charge. Also, employees (and their spouses
and children under age 21) of a brokerage firm or bank that has a selling
agreement with VanEck, and other affiliates and agents, may buy without a sales
charge.
Load-waived
Programs Through Financial Intermediaries
Financial
intermediaries may offer shares without a sales charge if they: (i) are
compensated by their clients on a fee-only basis, including but not limited to
Investment Advisors, Financial Planners, and Bank Trust Departments; or (ii)
have entered into an agreement with VanEck to offer Class A shares at net asset
value through a no-load network or platform, or through a self-directed
investment brokerage account program that may or may not charge a transaction
fee to its clients.
Institutional
Retirement Programs
Certain
financial institutions and third-party recordkeepers and/or administrators who
have agreements with VanEck to offer Class A shares at net asset value may buy
shares without a sales charge for their accounts on behalf of investors in
retirement plans and deferred compensation plans.
Reinstatement
Privilege
You
have the right, once a year, to reinvest (“buy back”) proceeds of a redemption
from Class A shares of the Fund into the Fund or Class A shares of another fund
of the VanEck Funds within 60 days without a sales charge. If you invest into
the same Fund
within
30 days before or after you redeem your shares at a loss, the “wash sale” rules
apply to disallow for tax purposes a loss realized upon redemption.
FOR
CLASS I AND CLASS Y SHARES
No
initial sales charge, or CDRC fee is imposed on Class I or Class Y shares. Class
I and Class Y are no-load share classes.
PLAN
OF DISTRIBUTION (12b-1 PLAN)
The
Fund has adopted a Plan of Distribution pursuant to Rule 12b-1 under the Act
that allows the Fund to pay distribution fees for the sale and distribution of
its shares. Of the amounts expended under the plan for the fiscal year ended
December 31, 2023 for all VanEck Funds, approximately 93% was paid to Brokers
and Agents who sold shares or serviced accounts of Fund shareholders. The
remaining 7% was retained by the Distributor to pay expenses such as printing
and mailing prospectuses and sales material. Because these fees are paid out of
the Fund’s assets on an on- going basis, over time these fees will increase the
cost of your investment and may cost you more than paying other types of sales
charges. Class I and Class Y shares do not have 12b-1 fees. For a complete
description of the Plan of Distribution, please see “Plan of Distribution (12b-1
Plan)” in the SAI.
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| VanEck
Funds Annual 12b-1 Schedule |
Fee
to Fund |
Payment
to Dealer |
|
| CM
Commodity Index Fund-A |
0.25% |
0.25% |
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4.
HOUSEHOLDING OF REPORTS AND PROSPECTUSES
If
more than one member of your household is a shareholder of any of the funds in
the VanEck Funds, regulations allow us, subject to certain requirements, to
deliver single copies of your shareholder reports, prospectuses and prospectus
supplements to a shared address for multiple shareholders. For example, a
husband and wife with separate accounts in the same fund who have the same
shared address generally receive two separate envelopes containing the same
report or prospectus. Under the system, known as “householding,” only one
envelope containing one copy of the same report or prospectus will be mailed to
the shared address for the household. You may benefit from this system in two
ways, a reduction in mail you receive and a reduction in fund expenses due to
lower fund printing and mailing costs. However, if you prefer to continue to
receive separate shareholder reports and prospectuses for each shareholder
living in your household now or at any time in the future, please call Account
Assistance at 800-544-4653.
5.
RETIREMENT PLANS
Fund
shares may be invested in tax-advantaged retirement plans sponsored by VanEck or
other financial organizations. Retirement plans sponsored by VanEck use UMB Bank
n.a. as custodian and must receive investments directly by check or wire using
the appropriate VanEck retirement plan application. Confirmed trades through a
broker or agent cannot be accepted. To obtain applications and helpful
information on VanEck retirement plans, contact your broker or agent or Account
Assistance.
Retirement
Plans Sponsored by VanEck:
Traditional
IRA
Roth
IRA
SEP
IRA
6.
FEDERAL INCOME TAXES
TAXATION
OF DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS YOU RECEIVE
The
Fund intends to qualify each year as a regulated investment company under the
Code. As a regulated investment company, the Fund generally pays no federal
income tax on the income and gains it distributes to you.
For
tax-reportable accounts, dividends and capital gains distributions are normally
taxable even if they are reinvested. Fund distributions of short-term capital
gains are taxed as ordinary income. Fund distributions of long-term capital
gains are taxed at long-term capital gain rates no matter how long you have
owned your fund shares. Certain income dividends are treated as qualified
dividend income, taxable at long-term capital gain rates provided certain
holding period requirements are met. Tax laws and regulations are subject to
change.
At
the time you purchase your Fund shares, the Fund’s NAV may reflect undistributed
income, undistributed capital gains, or net unrealized appreciation in the value
of portfolio securities held by the Fund. For taxable investors, a subsequent
distribution to you of such amounts, although constituting a return of your
investment, would be taxable. Buying shares in the Fund just before it declares
an income dividend or capital gains distribution is sometimes known as “buying a
dividend.”
TAXATION
OF SHARES YOU SELL
For
tax-reportable accounts, when you redeem your shares you may incur a capital
gain or loss on the proceeds. The amount of gain or loss, if any, is the
difference between the amount you paid for your shares (including reinvested
dividends and capital gains distributions) and the amount you receive from your
redemption. Be sure to keep your regular statements; they contain the
information necessary to calculate the capital gain or loss. An exchange of
shares from one Fund to another will be treated as a sale and purchase of Fund
shares. It is therefore a taxable event.
COST
BASIS REPORTING
As
required by law, for shares purchased on and after January 1, 2012 in accounts
eligible for IRS Tax Form 1099-B tax reporting by VanEck Funds for which tax
basis information is available (“covered shares”), the VanEck Funds will provide
cost basis information to you and the IRS for shares using the IRS Tax Form
1099-B. Generally, cost basis is the dollar amount paid to purchase shares,
including purchases of shares made by reinvestment of dividends and capital
gains distributions, adjusted for various items, such as sales charges and
transaction fees, wash sales, and returns of capital.
The
cost basis of your shares will be calculated using the Fund’s default cost basis
method of Average Cost, and the Fund will deplete your oldest shares first,
unless you instruct the Fund to use a different cost basis method. You may elect
the cost basis method that best fits your specific tax situation using VanEck’s
Cost Basis Election Form. It is important that any such election be received in
writing from you by the VanEck Funds before you redeem any covered shares since
the cost basis in effect at the time of redemption, as required by law, will be
reported to you and the IRS. Particularly, any election or revocation of the
Average Cost method must be received in writing by the VanEck Funds before you
redeem covered shares. The VanEck Funds will process any of your future
redemptions by depleting your oldest shares first (FIFO). If you elect a cost
basis method other than Average Cost, the method you chose will not be utilized
until shares held prior to January 1, 2012 are liquidated. Cost basis reporting
for non-covered shares will be calculated and reported separately from covered
shares. You should carefully review the cost basis information provided by the
Fund and make any additional cost basis, holding period, or other adjustments
that are required when reporting these amounts on your federal, state, and local
income tax returns. For tax advice specific to your situation, please contact
your tax advisor and visit the IRS website at IRS.gov. The VanEck Funds cannot
and do not provide any advice, including tax advice.
To
obtain VanEck’s Cost Basis Election Form and to learn more about the cost basis
elections offered by the VanEck Funds, please go to our website at vaneck.com or
call VanEck Account Services at 800-544-4653.
BACKUP
WITHHOLDING
By
law, if you do not provide the Fund with your proper taxpayer identification
number and certain required certifications, you may be subject to backup
withholding on any distributions of income, capital gains, or proceeds from the
sale of your shares. The Fund also must withhold if the IRS instructs it to do
so. When withholding is required, the amount will be 24% of any distributions or
proceeds paid.
STATE
AND LOCAL TAXES
Fund
distributions and gains from the sale or exchange of your Fund shares generally
are subject to state and local taxes.
NON-RESIDENT
ALIENS
Dividends
and short-term capital gains, if any, paid to non-resident aliens generally are
subject to the maximum withholding tax (or lower tax treaty rates for certain
countries). The IRS considers these dividends U.S. source income. Exemptions
from U.S. withholding tax are provided for certain capital gain dividends paid
by the Fund from net long-term capital gains, interest-related dividends paid by
the Fund from its qualified net interest income from U.S. sources and short-
term capital gain dividends, if such amounts are reported by the Fund. However,
notwithstanding such exemptions from U.S. withholding at the source, any such
dividends and distributions of income and capital gains will be subject to
backup withholding at a rate of 24% if you fail to properly certify that you are
not a U.S. person.
As
part of the Foreign Account Tax Compliance Act, (“FATCA”), the Fund is required
to withhold a 30% federal tax on income dividends paid by the Fund to (i)
foreign financial institutions (“FFIs”), including non-U.S. investment funds,
unless they agree to collect and disclose to the IRS information regarding their
direct and indirect U.S. account holders and (ii) certain nonfinancial foreign
entities (“NFFEs”), unless they certify certain information regarding their
direct and indirect U.S. owners. After December 31, 2018, FATCA withholding also
would have applied to certain capital gain distributions, return of capital
distributions and the proceeds arising from the sale of Fund shares; however,
based on proposed regulations issued by the IRS, which can be relied on
currently, such withholding is no longer required unless final regulations
provide otherwise (which is not expected). To avoid possible withholding, FFIs,
other than FFIs subject to special treatment under certain intergovernmental
agreements, will need to enter into agreements with the IRS which state that
they will provide the IRS information, including the names, account numbers and
balances, addresses and taxpayer identification numbers of U.S. account holders
and comply with due diligence procedures with respect to the identification of
U.S. accounts as well as agree to withhold tax on certain types of withholdable
payments made to non-compliant foreign financial institutions or to applicable
foreign account holders who fail to provide the required information to the IRS,
or similar account information and required documentation to a local revenue
authority, should an applicable intergovernmental agreement be implemented.
NFFEs will need to provide certain information regarding each substantial U.S.
owner
or certifications of no substantial U.S. ownership, unless certain exceptions
apply, or agree to provide certain information to the IRS.
The
Fund may be subject to the FATCA withholding obligation, and also will be
required to perform due diligence reviews to classify foreign entity investors
for FATCA purposes. Investors are required to agree to provide information
necessary to allow the Fund to comply with the FATCA rules. If the Fund is
required to withhold amounts from payments pursuant to FATCA, investors will
receive distributions that are reduced by such withholding amounts.
Because
everyone’s tax situation is unique, you should consult your tax professional
about federal, state, local, or foreign tax consequences before making an
investment in the Fund.
7.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The
Fund makes distributions of all of its net investment income to shareholders as
dividends annually. The Fund makes distributions of any net capital gains, at
least annually, in December. See your tax adviser for details. Occasionally, a
dividend and/or capital gain distribution may be made outside of the normal
schedule.
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| |
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|
| |
| Dividends
and Capital Gains Distribution Schedule |
|
| Fund |
Dividends |
Distribution
of Short-Term and Long-Term Capital Gains |
|
| CM
Commodity Index Fund |
December |
December |
|
|
|
|
| |
Dividends
and Capital Gains Distributions Reinvestment Plan
Dividends
and/or distributions are automatically reinvested into your account without a
sales charge, unless you elect a cash payment. You may elect cash payment either
on your original Account Application, or by calling Account Assistance at
800-544-4653.
Divmove
You
can have your cash dividends from a Class A Fund automatically invested in Class
A shares of another VanEck Fund. Cash dividends are invested on the payable
date, without a sales charge. For details and an Application, call Account
Assistance.
8.
MANAGEMENT OF THE FUND AND SERVICE PROVIDERS
INFORMATION
ABOUT FUND MANAGEMENT
INVESTMENT
ADVISER
Van
Eck Absolute Return Advisers Corporation (the “Adviser”) is a wholly owned
subsidiary of Van Eck Associates Corporation (“VEAC”) and is registered with the
Securities and Exchange Commission as an investment adviser under the Investment
Advisers Act of 1940, as amended, and with the Commodity Futures Trading
Commission as a Commodity Pool Operator and Commodity Trading Adviser under the
Commodity Exchange Act of 1936, as amended; provided, however that with respect
to the Fund and the Subsidiary, the Adviser relies on certain exemptions from
many of the requirements that would otherwise be applicable to it as a
registered Commodity Pool Operator and Commodity Trading Advisor, as described
above under “Additional Information about Principal Investment Strategies and
Risks--Regulatory Risk.” The Adviser also acts as adviser to other pooled
investment vehicles.
VEAC
owns 100% of the voting stock of the Adviser. Jan F. van Eck and members of his
family own 100% of the voting stock of VEAC. As of December 31, 2023, the
Adviser’s assets under management were approximately $824.92
million.
Fees
Paid To The Adviser:
Pursuant to the advisory agreement between the Adviser and the Trust (the
“Advisory Agreement”) the Fund pays the Adviser a monthly fee at the annual rate
of 0.65% of the Fund’s average daily net assets. This includes the fee paid to
the Adviser for accounting and administrative services. For purposes of
calculating these fees for the Fund, the net assets of the Fund include the
value of the Fund’s interest in the Subsidiary. The Subsidiary does not pay the
Adviser a fee for managing the Subsidiary’s portfolio.
The
Adviser has agreed to waive fees and/or pay expenses for the Fund to the extent
necessary to prevent the operating expenses of the Fund (excluding acquired fund
fees and expenses, interest expense, trading expenses, dividends and interest
payments on securities sold short, taxes and extraordinary expenses) from
exceeding 0.95% for Class A, 0.65% for Class I, and 0.70% for Class Y of the
Fund’s average daily net assets per year until May 1, 2025. During such time,
the expense limitation is expected to continue until the Board acts to
discontinue all or a portion of such expense limitation. In addition, the
Adviser may voluntarily reimburse the Fund for certain swap trading
costs.
The
Adviser also has agreed to waive fees and/or pay expenses for the Fund to the
extent necessary to prevent the operating expenses of the Fund’s Class Y shares
from exceeding the operating expenses of the Fund’s Class A shares.
For
the Fund’s most recent fiscal year, the advisory fee paid to the Adviser was as
follows:
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|
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| |
|
|
| |
| VanEck
Funds |
As
a % of average daily net assets |
|
| CM
Commodity Index Fund |
0.65% |
|
|
|
| |
The
Adviser may hire and terminate sub-advisers in accordance with the terms of an
exemptive order obtained by the Fund and the Adviser from the SEC, under which
the Adviser is permitted, subject to supervision and approval of the Board, to
enter into and materially amend sub-advisory agreements without seeking
shareholder approval. The Adviser will furnish shareholders of the Fund with
information regarding a new sub-adviser within 90 days of the hiring of the new
sub- adviser. Currently, the Adviser has not hired a sub-adviser to assist with
the portfolio management of the Fund.
A
discussion regarding the basis for the Board’s approval of the Advisory
Agreement is available in the Fund’s semi-annual report to shareholders for the
period ended June 30, 2023.
PORTFOLIO
MANAGERS
Roland
Morris, Jr., Portfolio Manager of the Fund, is primarily responsible for the
day-to-day portfolio management of the Fund.
Roland
Morris, Jr.
Mr. Morris is Portfolio Manager of the Fund. He has been with VEAC since 2012
and has 35 years of experience in the international and financial markets. Prior
to joining VEAC, Mr. Morris worked as a macro/commodities trading specialist and
as manager of futures clearing and execution services.
Chris
Mailloux, CFA. Mr.
Mailloux is Deputy Portfolio Manager of the Fund. He has been employed by VEAC
since 2007.
The
SAI provides additional information about the above Portfolio Managers, their
compensation, other accounts they manage, and their securities ownership in the
Fund.
THE
TRUST
For
more information on the VanEck Funds (the “Trust”), the Trustees and the
Officers of the Trust, see “General Information,” “Description of the Trust” and
“Trustees and Officers” in the SAI.
THE
DISTRIBUTOR
Van
Eck Securities Corporation, 666 Third Avenue, New York, NY 10017 (the
“Distributor”), a wholly owned subsidiary of the Adviser, has entered into a
Distribution Agreement with the Trust for distributing shares of the
Fund.
The
Distributor generally sells and markets shares of the Fund through
intermediaries, such as broker-dealers. The intermediaries may be compensated by
the Fund for providing various services.
In
addition, the Distributor or the Adviser may pay certain intermediaries, out of
its own resources and not as an expense of the Fund, additional cash or non-cash
compensation as an incentive to intermediaries to promote and sell shares of the
Fund and other mutual funds distributed by the Distributor. These payments are
commonly known as “revenue sharing”. The benefits that the Distributor or the
Adviser may receive when each of them makes these payments include, among other
things, placing the Fund on the intermediary’s sales system and/or preferred or
recommended fund list, offering the Fund through the intermediary’s advisory or
other specialized programs, and/or access (in some cases on a preferential basis
over other competitors) to individual members of the intermediary’s sales force.
Such payments may also be used to compensate intermediaries for a variety of
administrative and shareholders services relating to investments by their
customers in the Fund.
The
fees paid by the Distributor or the Adviser to intermediaries may be calculated
based on the gross sales price of shares sold by an intermediary, the net asset
value of shares held by the customers of the intermediary, or otherwise. These
fees may, but are not normally expected to, exceed in the aggregate 0.50% of the
average net assets of the Fund attributable to a particular intermediary on an
annual basis.
The
Distributor or the Adviser may also provide intermediaries with additional cash
and non-cash compensation, which may include financial assistance to
intermediaries in connection with conferences, sales or training programs for
their employees, seminars for the public and advertising campaigns, technical
and systems support, attendance at sales meetings and reimbursement of ticket
charges. In some instances, these incentives may be made available only to
intermediaries whose representatives have sold or may sell a significant number
of shares.
Intermediaries
may receive different payments, based on a number of factors including, but not
limited to, reputation in the industry, sales and asset retention rates, target
markets, and customer relationships and quality of service. No one factor is
determinative of the type or amount of additional compensation to be provided.
Financial intermediaries that sell the Fund’s shares may also act as a broker or
dealer in connection with execution of transactions for the Fund’s portfolio.
The Fund and the Adviser have adopted procedures to ensure that the sales of the
Fund’s shares by an intermediary will not affect the selection of brokers for
execution of portfolio transactions.
Not
all intermediaries are paid the same to sell mutual funds. Differences in
compensation to intermediaries may create a financial interest for an
intermediary to sell shares of a particular mutual fund, or the mutual funds of
a particular family of mutual funds. Before purchasing shares of the Fund, you
should ask your intermediary or its representative about the compensation in
connection with the purchase of such shares, including any revenue sharing
payments it receives from the Distributor.
THE
CUSTODIAN
State
Street Bank & Trust Company
One
Lincoln Street
Boston,
MA 02111
THE
TRANSFER AGENT
SS&C
GIDS, Inc.
210
West 10th Street, 8th Floor
Kansas
City, MO 64105
INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
PricewaterhouseCoopers
LLP
300
Madison Avenue
New
York, NY 10017
COUNSEL
Stradley
Ronon Stevens and Young, LLP
2005
Market Street, Suite 2600
Philadelphia,
PA 19103
|
| |
IV.
DESCRIPTION OF THE CMCI |
The
following is a more complete description of the UBS Constant Maturity Commodity
Total Return Index (the “CMCI” or the “Index”), including, without limitation,
information about the composition, weighting, method of calculation and
procedures for changes in components and weights.
Overview
of the CMCI
The
Index represents a basket of commodity futures contracts with 29 commodity
components, (as of February 29, 2024). Exposure to each component is allocated
across a range of maturity pillars ranging from three months up to a maximum of
three years. Not all commodities have the full range of maturity exposures. In
contrast, traditional commodity indices typically invest in front-month and
next-month futures contracts which have shorter tenors (time to maturity) than
the average Index tenor.
The
Index also employs a “constant maturity” approach by relying on a continuous
roll methodology in which the Index invests in and out of future contracts on a
daily basis in order to maintain the average maturity of each pillar. This
methodology differs from traditional commodity indices, which usually are
pre-defined to roll during a fixed window of days on a monthly or bi-monthly
basis.
The
Index represents commodities in five primary sectors: energy, agriculture,
industrial metals, precious metals and livestock. The underlying commodities
trade on various exchanges.
The
return of the Index is generated by two components: (i) uncollateralized returns
from holding and rolling of futures contracts comprising the Index and (ii) the
fixed income return reflecting the Secured Overnight Financing Rate
(“SOFR”)-based interest earned on a hypothetical portfolio theoretically
deposited as full collateral for the notional exposure of hypothetical positions
in the futures contracts comprising the Index.
As
of February 29, 2024, the Index consisted of the following commodity sectors
with the following relative target weights: Energy (32.7%), Agriculture (31.0%),
Industrial Metals (25.4%), Precious Metals (6.3%) and Livestock
(4.6%).
Component
Selection and Target Weights
The
weighting process for the Index is designed to reflect the economic significance
and market liquidity of each commodity. The Index sponsor uses a two-step
approach to determine target weights: first, economic indicators (regional
consumer price indexes (CPI), producer price indexes (PPI) and gross domestic
product (GDP)), along with liquidity analysis, are used to determine the sector
weights (energy, agriculture, industrial metals, precious metals and livestock);
secondly, global consumption data in conjunction with further liquidity analysis
is used to calculate the individual component target weights.
Changes
in the Target Weights and/or Index Composition
Target
weights for each Index commodity futures contract are established on an annual
basis The Index is rebalanced to the new target weights during the maintenance
period, which is the final three business days of July.
Tenors
of Contracts
The
Index represents a weighted average of all available Index constant maturities
(ranging from three months to three years). The distribution of weights to
available tenors (time to maturity) is a function of relative liquidity of the
underlying futures contracts. As of February 29, 2024, the average tenor of the
futures contracts comprising the Index is approximately 6.5 months. Since the
relative liquidity of commodity futures contracts for a given commodity tends to
decline as time to maturity increases, the weights of the longer-dated tenors
are typically lower than those for the short-dated tenors for a given
commodity.
Rebalancing
of the Index Components
Due
to price movements, the weight of each component in the Index will fluctuate
from its target weight over time. The weight of each Index component is
rebalanced over the final three Index business days of each month in order to
bring each underlying commodity risk position back to its target weight for each
tenor. The process is automatic and is implemented via a pre-defined
methodology. The Index provider may delay or change a scheduled rebalancing or
reconstitution of the Index or the implementation of certain rules at its sole
discretion.
Calculation
of the Index
The
CMCI is calculated and disseminated by MerQube, Inc. with a daily closing Index
level published on each Trading Day. Index information is available via
Bloomberg on pages CUBS, CMCN or CMCX and from Reuters on page UBSCMCI. For
further information on CMCI methodology and CMCI index values, investors can go
to http://www.ubs.com/cmci or https://merqube.com/index/CMCITR.
Total
Return
The
Index is a “total return” index. In addition to uncollateralized returns
generated from the futures contracts comprising the Index, a daily fixed-income
return is added, which reflects the interest earned on a hypothetical fixed
income portfolio which theoretically collateralizes 100% of the notional value
of the hypothetical positions in the futures contracts comprising the Index. The
rate used to calculate the daily fixed income return is the SOFR, as published
by the New York Federal Reserve Bank every business day and generally made
effective with respect to the Index on the following Trading Day.
UBS
may delay or change a scheduled rebalancing or reconstitution of the Index or
the implementation of certain rules at its sole discretion.
|
| |
V.
LICENSE AGREEMENTS AND
DISCLAIMERS |
Van
Eck Associates Corporation (“VEAC”) has entered into a licensing agreement with
UBS AG, London (“UBS”) to use the UBS Constant Maturity Commodity Total Return
Index (the “CMCI”). The CM Commodity Index Fund is entitled to use the CMCI
pursuant to a sub-licensing arrangement with VEAC.
UBS
owns or exclusively licenses all proprietary rights with respect to the CMCI.
Any third-party product based on or related to the CMCI (“Product”) may only be
issued upon the prior joint written approval of UBS and upon the execution of a
license agreement between UBS and the party intending to launch a Product (a
“Licensee”). In no way does UBS sponsor or endorse, nor is it otherwise involved
in the issuance and offering of a Product nor does it make any representation or
warranty, express or implied, to the holders of the Product or any member of the
public regarding the advisability of investing in the Product or commodities
generally or in futures particularly, or as to results to be obtained from the
use of the CMCI or from the Product. Further, UBS does not provide investment
advice to any Licensee specific to the Product, other than providing the CMCI as
agreed in the license agreement with the Licensee, and which will be done
without consideration of the particular needs of the Product or the Licensee.
UBS specifically disclaims any liability to any party for any inaccuracy in the
data on which the CMCI is based, for any mistakes, errors, omissions or
interruptions in the calculation and/or dissemination of the Fund, or for the
manner in which such is applied in connection with the issuance and offering of
a Product. In no event shall UBS have any liability to any party for any lost
profits or indirect, punitive, special or consequential damages or
losses.
THIS
IS NOT AN OFFER OR SOLICITATION BY UBS OF AN OFFER TO BUY OR SELL ANY SECURITY
OR INVESTMENT. PAST PERFORMANCE OF THE UBS CONSTANT MATURITY COMMODITY TOTAL
RETURN INDEX IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
The
S&P 500®
Index included in the Fund’s performance table is a product of S&P Dow Jones
Indices LLC and/or its affiliates and has been licensed for use by the Adviser.
Copyright © 2024 S&P Dow Jones Indices LLC, a division of S&P Global,
Inc., and/or its affiliates. All rights reserved. Redistribution or reproduction
in whole or in part are prohibited without written permission of S&P Dow
Jones Indices LLC. For more information on any of S&P Dow Jones Indices
LLC’s indices please visit www.spdji.com. S&P®
is a registered trademark of S&P Global and Dow Jones®
is a registered trademark of Dow Jones Trademark Holdings LLC. Neither S&P
Dow Jones Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor
their third party licensors make any representation or warranty, express or
implied, as to the ability of any index to accurately represent the asset class
or market sector that it purports to represent and neither S&P Dow Jones
Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor their third
party licensors shall have any liability for any errors, omissions, or
interruptions of any index or the data included therein.
S&P
DOW JONES INDICES DOES NOT GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS AND/OR
THE COMPLETENESS OF EACH INDEX OR ANY DATA RELATED THERETO, OR ANY COMMUNICATION
INCLUDING BUT NOT LIMITED TO, ORAL OR WRITTEN COMMUNICATION (INCLUDING
ELECTRONIC COMMUNICATIONS) WITH RESPECT THERETO. S&P DOW JONES INDICES SHALL
NOT BE SUBJECT TO ANY DAMAGES OR LIABILITY FOR ANY ERRORS, OMISSIONS, OR DELAYS
THEREIN. S&P DOW JONES INDICES MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND
EXPRESSLY DISCLAIMS ALL WARRANTIES, OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OR USE OR AS TO RESULTS TO BE OBTAINED BY THE ADVISER, OR ANY
OTHER PERSON OR ENTITY FROM THE USE OF EACH INDEX, OR WITH RESPECT TO ANY DATA
RELATED THERETO. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT WHATSOEVER
SHALL S&P DOW JONES INDICES BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL,
PUNITIVE, OR CONSEQUENTIAL DAMAGES, INCLUDING BUT NOT LIMITED TO, LOSS OF
PROFITS, TRADING LOSSES, LOST TIME, OR GOODWILL, EVEN IF THEY HAVE BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY,
OR OTHERWISE. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR
ARRANGEMENTS BETWEEN S&P DOW JONES INDICES AND THE ADVISER, OTHER THAN THE
LICENSORS OF S&P DOW JONES INDICES.
The
financial highlights tables that follow are intended to help you understand the
Fund’s financial performance for the past five years. Certain information
reflects financial results for a single Fund share. The total returns in the
table represent the rate that an investor would have earned or lost on an
investment in the Fund (assuming reinvestment of all dividends and
distributions). The information for the fiscal years ended December 31, 2022 and
December 31, 2023 has been audited by PricewaterhouseCoopers LLP, the Fund’s
independent registered public accounting firm, whose report, along with the
Fund’s financial statements are included in the Fund’s annual report, which is
available upon request. The information for periods prior to the fiscal year
ended December 31, 2022 has been audited by another independent registered
public accounting firm.
CONSOLIDATED
FINANCIAL HIGHLIGHTS
For
a share outstanding throughout each year:
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|
Class
A(a) |
|
| Year
Ended December 31, |
|
| 2023 |
| 2022 |
| 2021 |
| 2020 |
| 2019 |
|
|
|
| |
Net
asset value, beginning of year |
$ |
69.15 |
|
| $ |
75.75 |
|
| $ |
69.90 |
|
| $ |
69.15 |
|
| $ |
64.35 |
|
|
|
|
| |
Net
investment income (loss) (b) |
2.73 |
|
| 0.30 |
|
| (0.75) |
|
| (0.15) |
|
| 0.90 |
|
|
|
| |
Net
realized and unrealized gain (loss) on |
|
|
|
|
|
|
|
|
|
|
|
|
| |
investments |
(4.70) |
| 11.10 |
| 23.55 |
| 0.92 |
(c) |
4.50 |
|
|
|
| |
Total
from investment operations |
(1.97) |
| 11.40 |
| 22.80 |
| 0.77 |
| 5.40 |
|
|
|
| |
Distributions
from: |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net
investment income |
(2.32) |
| (18.00) |
| (16.95) |
| (0.02) |
| (0.60) |
|
|
|
| |
Net
asset value, end of year |
$ |
64.86 |
|
| $ |
69.15 |
|
| $ |
75.75 |
|
| $ |
69.90 |
|
| $ |
69.15 |
|
|
|
|
| |
Total
return (d) |
(2.87) |
| % |
15.29 |
| % |
32.96 |
| % |
1.11 |
| % |
8.37 |
| % |
|
|
| |
Ratios
to average net assets |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Gross
expenses |
1.32 |
| % |
1.36 |
| % |
1.38 |
| % |
1.41 |
| % |
1.43 |
| % |
|
|
| |
Net
expenses |
0.95 |
| % |
0.95 |
| % |
0.95 |
| % |
0.95 |
| % |
0.95 |
| % |
|
|
| |
Net
investment income (loss) |
4.00 |
| % |
0.39 |
| % |
(0.91) |
| % |
(0.28) |
| % |
1.24 |
| % |
|
|
| |
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net
assets, end of year (in millions) |
$26 |
|
| $22 |
|
| $31 |
|
| $22 |
|
| $27 |
|
|
|
|
| |
Portfolio
turnover rate |
— |
| % |
— |
| % |
— |
| % |
— |
| % |
— |
| % |
|
|
| |
(a)On
September 11, 2023, the Fund effected a 1 for 15 reverse share split. Per share
data has been adjusted to reflect the reverse share split.
(b)Calculated
based upon average shares outstanding
(c)The
amount shown does not correspond with the aggregate net gain (loss) on
investments for the period due to the timing of sales and repurchase of shares
in relation to fluctuating market values of the investments of the
Fund.
(d)Returns
include adjustments in accordance with U.S. Generally Accepted Accounting
Principles. Net asset values and returns for financial reporting purposes may
differ from those for shareholder transactions.
CONSOLIDATED
FINANCIAL HIGHLIGHTS
For
a share outstanding throughout each year:
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Class
I(a) |
|
| Year
Ended December 31, |
|
| 2023 |
| 2022 |
| 2021 |
| 2020 |
| 2019 |
|
|
|
| |
Net
asset value, beginning of year |
$ |
71.85 |
|
| $ |
78.00 |
|
| $ |
71.70 |
|
| $ |
70.65 |
|
| $ |
65.85 |
|
|
|
|
| |
Net
investment income (loss) (b) |
3.00 |
| 0.60 |
| (0.60) |
| — |
| 1.05 |
|
|
|
| |
Net
realized and unrealized gain (loss) on |
|
|
|
|
|
|
|
|
|
|
|
|
| |
investments |
(4.88) |
| 11.55 |
| 24.15 |
| 1.07 |
(c) |
4.50 |
|
|
|
| |
Total
from investment operations |
(1.88) |
| 12.15 |
| 23.55 |
| 1.07 |
| 5.55 |
|
|
|
| |
Distributions
from: |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net
investment income |
(2.55) |
| (18.30) |
| (17.25) |
| (0.02) |
| (0.75) |
|
|
|
| |
Net
asset value, end of year |
$ |
67.42 |
|
| $ |
71.85 |
|
| $ |
78.00 |
|
| $ |
71.70 |
|
| $ |
70.65 |
|
|
|
|
| |
Total
return (d) |
(2.63) |
| % |
15.87 |
| % |
33.07 |
| % |
1.51 |
| % |
8.55 |
| % |
|
|
| |
Ratios
to average net assets |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Gross
expenses |
0.89 |
| % |
0.92 |
| % |
0.90 |
| % |
0.93 |
| % |
0.97 |
| % |
|
|
| |
Net
expenses |
0.65 |
| % |
0.65 |
| % |
0.65 |
| % |
0.65 |
| % |
0.65 |
| % |
|
|
| |
Net
investment income (loss) |
4.24 |
| % |
0.72 |
| % |
(0.61) |
| % |
(0.10) |
| % |
1.50 |
| % |
|
|
| |
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net
assets, end of year (in millions) |
$131 |
|
| $234 |
|
| $295 |
|
| $193 |
|
| $195 |
|
|
|
|
| |
Portfolio
turnover rate |
— |
| % |
— |
| % |
— |
| % |
— |
| % |
— |
| % |
|
|
| |
(a)On
September 11, 2023, the Fund effected a 1 for 15 reverse share split. Per share
data has been adjusted to reflect the reverse share split.
(b)Calculated
based upon average shares outstanding
(c)The
amount shown does not correspond with the aggregate net gain (loss) on
investments for the period due to the timing of sales and repurchase of shares
in relation to fluctuating market values of the investments of the
Fund.
(d)Returns
include adjustments in accordance with U.S. Generally Accepted Accounting
Principles. Net asset values and returns for financial reporting purposes may
differ from those for shareholder transactions.
CONSOLIDATED
FINANCIAL HIGHLIGHTS
For
a share outstanding throughout each year:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Class
Y(a) |
|
| Year
Ended December 31, |
|
| 2023 |
| 2022 |
| 2021 |
| 2020 |
| 2019 |
|
|
|
| |
Net
asset value, beginning of year |
$ |
71.55 |
|
| $ |
77.70 |
|
| $ |
71.40 |
|
| $ |
70.50 |
|
| $ |
65.55 |
|
|
|
|
| |
Net
investment income (loss) (b) |
2.99 |
| 0.60 |
| (0.60) |
| — |
| 1.05 |
|
|
|
| |
Net
realized and unrealized gain (loss) on |
|
|
|
|
|
|
|
|
|
|
|
|
| |
investments |
(4.96) |
| 11.55 |
| 24.15 |
| 0.92 |
(c) |
4.65 |
|
|
|
| |
Total
from investment operations |
(1.97) |
| 12.15 |
| 23.55 |
| 0.92 |
| 5.70 |
|
|
|
| |
Distributions
from: |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net
investment income |
(2.49) |
| (18.30) |
| (17.25) |
| (0.02) |
| (0.75) |
|
|
|
| |
Net
asset value, end of year |
$ |
67.09 |
|
| $ |
71.55 |
|
| $ |
77.70 |
|
| $ |
71.40 |
|
| $ |
70.50 |
|
|
|
|
| |
Total
return (d) |
(2.77) |
| % |
15.87 |
| % |
33.14 |
| % |
1.30 |
| % |
8.73 |
| % |
|
|
| |
Ratios
to average net assets |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Gross
expenses |
0.93 |
| % |
1.00 |
| % |
0.98 |
| % |
1.03 |
| % |
1.04 |
| % |
|
|
| |
Net
expenses |
0.70 |
| % |
0.70 |
| % |
0.70 |
| % |
0.70 |
| % |
0.70 |
| % |
|
|
| |
Net
investment income (loss) |
4.24 |
| % |
0.70 |
| % |
(0.64) |
| % |
— |
| % |
1.53 |
| % |
|
|
| |
Supplemental
data |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net
assets, end of year (in millions) |
$339 |
|
| $323 |
|
| $330 |
|
| $209 |
|
| $247 |
|
|
|
|
| |
Portfolio
turnover rate |
— |
| % |
— |
| % |
— |
| % |
— |
| % |
— |
| % |
|
|
| |
(a)On
September 11, 2023, the Fund effected a 1 for 15 reverse share split. Per share
data has been adjusted to reflect the reverse share split.
(b)Calculated
based upon average shares outstanding
(c)The
amount shown does not correspond with the aggregate net gain (loss) on
investments for the period due to the timing of sales and repurchase of shares
in relation to fluctuating market values of the investments of the
Fund.
(d)Returns
include adjustments in accordance with U.S. Generally Accepted Accounting
Principles. Net asset values and returns for financial reporting purposes may
differ from those for shareholder transactions.
ck0000768847-20231231
VANECK
FUNDS
APPENDIX
A: INTERMEDIARY SALES CHARGE DISCOUNTS AND WAIVERS
Dated
May 1, 2024
CM
COMMODITY INDEX FUND
CLASS
A: CMCAX / CLASS I: COMIX / CLASS Y: CMCYX
This
Appendix A is not a prospectus. It should be read in conjunction with the
prospectus dated May 1, 2024 (the “Prospectus”) for VanEck Funds (the “Trust”),
relating to CM Commodity Index Fund (the “Fund”), as it may be revised from time
to time. A copy of the Prospectus for the Trust, relating to the Fund, may be
obtained without charge by visiting the VanEck website at vaneck.com, by calling
toll free 800.826.1115 or by writing to the Trust or Van Eck Securities
Corporation, the Fund’s distributor (the “Distributor”). The information
disclosed in this Appendix A is part of, and incorporated in, the Prospectus.
Capitalized terms used herein that are not defined have the same meaning as in
the Prospectus, unless otherwise noted. For the avoidance of doubt, for purposes
of this Appendix A, references to a CDSC below also include the contingent
deferred redemption charge (“CDRC”) as defined in the Prospectus.
Specific
intermediaries may have different policies and procedures regarding the
availability of front-end sales load waivers or contingent deferred sales charge
(“CDSC”) waivers, which are discussed below. In addition, please see the section
of the Prospectus entitled “Shareholder Information-Sales Charges” for more
information on sales charges and waivers available for different classes. In all
instances, it is the purchaser’s responsibility to notify the Funds or the
purchaser’s financial intermediary at the time of purchase of any facts
qualifying the purchaser for sales charge discounts or waivers.
a.Purchases
or sales of front-end (i.e. Class A) or level-load (i.e., Class C) mutual fund
shares through a Merrill platform or account will be eligible only for the
following sales load waivers (front-end, contingent deferred, or back-end
waivers) and discounts, which differ from those disclosed elsewhere in this
Fund’s prospectus. Purchasers will have to buy mutual fund shares directly from
the mutual fund company or through another intermediary to be eligible for
waivers or discounts not listed below.
It
is the client’s responsibility to notify Merrill at the time of purchase or sale
of any relationship or other facts that qualify the transaction for a waiver or
discount. A Merrill representative may ask for reasonable documentation of such
facts and Merrill may condition the granting of a waiver or discount on the
timely receipt of such documentation.
Additional
information on waivers and discounts is available in the Merrill Sales Load
Waiver and Discounts Supplement (the “Merrill SLWD Supplement”) and in the
Mutual Fund Investing at Merrill pamphlet at ml.com/funds. Clients are
encouraged to review these documents and speak with their financial advisor to
determine whether a transaction is eligible for a waiver or discount.
|
| |
Front-end
Load Waivers Available at Merrill |
Shares
of mutual funds available for purchase by employer-sponsored retirement,
deferred compensation, and employee benefit plans (including health
savings accounts) and trusts used to fund those plans provided the shares
are not held in a commission-based brokerage account and shares are held
for the benefit of the plan. For purposes of this provision,
employer-sponsored retirement plans do not include SEP IRAs, Simple IRAs,
SAR-SEPs or Keogh plans |
Shares
purchased through a Merrill investment advisory program |
Brokerage
class shares exchanged from advisory class shares due to the holdings
moving from a Merrill investment advisory program to a Merrill brokerage
account |
Shares
purchased through the Merrill Edge Self-Directed platform |
Shares
purchased through the systematic reinvestment of capital gains
distributions and dividend reinvestment when purchasing shares of the same
mutual fund in the same account |
Shares
exchanged from level-load shares to front-end load shares of the same
mutual fund in accordance with the description in the Merrill SLWD
Supplement |
Shares
purchased by eligible employees of Merrill or its affiliates and their
family members who purchase shares in accounts within the employee’s
Merrill Household (as defined in the Merrill SLWD Supplement) |
Shares
purchased by eligible persons associated with the fund as defined in this
prospectus (e.g. the fund’s officers or trustees) |
Shares
purchased from the proceeds of a mutual fund redemption in front-end load
shares provided (1) the repurchase is in a mutual fund within the same
fund family; (2) the repurchase occurs within 90 calendar days from the
redemption trade date, and (3) the redemption and purchase occur in the
same account (known as Rights of Reinstatement). Automated transactions
(i.e. systematic purchases and withdrawals) and purchases made after
shares are automatically sold to pay Merrill’s account maintenance fees
are not eligible for Rights of Reinstatement |
Contingent
Deferred Sales Charge (“CDSC”) Waivers on Front-end, Back-end, and Level
Load Shares Available at Merrill |
Shares
sold due to the client’s death or disability (as defined by Internal
Revenue Code Section 22e(3)) |
Shares
sold pursuant to a systematic withdrawal program subject to Merrill’s
maximum systematic withdrawal limits as described in the Merrill SLWD
Supplement |
Shares
sold due to return of excess contributions from an IRA
account |
Shares
sold as part of a required minimum distribution for IRA and retirement
accounts due to the investor reaching the qualified age based on
applicable IRS regulation |
Front-end
or level-load shares held in commission-based, non-taxable retirement
brokerage accounts (e.g. traditional, Roth, rollover, SEP IRAs, Simple
IRAs, SAR-SEPs or Keogh plans) that are transferred to fee-based accounts
or platforms and exchanged for a lower cost share class of the same mutual
fund |
Front-end
Load Discounts Available at Merrill: Breakpoints, Rights of Accumulation
& Letters of Intent |
Breakpoint
discounts, as described in this prospectus, where the sales load is at or
below the maximum sales load that Merrill permits to be assessed to a
front-end load purchase, as described in the Merrill SLWD
Supplement |
Rights
of Accumulation (ROA), as described in the Merrill SLWD Supplement, which
entitle clients to breakpoint discounts based on the aggregated holdings
of mutual fund family assets held in accounts in their Merrill
Household |
Letters
of Intent (LOI), which allow for breakpoint discounts on eligible new
purchases based on anticipated future eligible purchases within a fund
family at Merrill, in accounts within your Merrill Household, as further
described in the Merrill SLWD Supplement |
b.Shareholders
purchasing Fund shares through a Morgan Stanley Wealth Management transactional
brokerage account will be eligible only for the following front-end sales charge
waivers with respect to Class A shares, which may differ from and may be more
limited than those disclosed elsewhere in this Fund’s Prospectus or
SAI.
|
| |
Front-end
Sales Charge Waivers on Class A Shares available at Morgan Stanley Wealth
Management |
Employer-sponsored
retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b)
plans, profit sharing and money purchase pension plans and defined benefit
plans). For purposes of this provision, employer-sponsored retirement
plans do not include SEP IRAs, Simple IRAs, SAR-SEPs or Keogh
plans |
Morgan
Stanley employee and employee-related accounts according to MSSB’s account
linking rules |
Shares
purchased through reinvestment of dividends and capital gains
distributions when purchasing shares of the same fund |
Shares
purchased through a Morgan Stanley self-directed brokerage
account |
Class
C (i.e., level-load) shares that are no longer subject to a contingent
deferred sales charge and are converted to Class A shares of the same fund
pursuant to Morgan Stanley Wealth Management’s share class conversion
program |
Shares
purchased from the proceeds of redemptions within the same fund family,
provided (i) the repurchase occurs within 90 days following the
redemption, (ii) the redemption and purchase occur in the same account,
and (iii) redeemed shares were subject to a front-end or deferred sales
charge. |
c.Shareholders
purchasing Fund shares through a Raymond James platform or account will be
eligible only for the following load waivers (front-end sales charge waivers and
contingent deferred, or back-end, sales charge waivers) and discounts, which may
differ from those disclosed elsewhere in this Fund’s Prospectus or
SAI.
|
| |
Front-end
sales load waivers on Class A shares available at Raymond
James |
Shares
purchased in an investment advisory program. |
Shares
purchased within the same fund family through a systematic reinvestment of
capital gains and dividend distributions. |
Employees
and registered representatives of Raymond James or its affiliates and
their family members as designated by Raymond James. |
Shares
purchased from the proceeds of redemptions within the same fund family,
provided (1) the repurchase occurs within 90 days following the
redemption, (2) the redemption and purchase occur in the same account, and
(3) redeemed shares were subject to a front-end or deferred sales load
(known as Rights of Reinstatement). |
A
shareholder in the Fund’s Class C shares will have their shares converted
at net asset value to Class A shares (or the appropriate share class) of
the Fund if the shares are no longer subject to a CDSC and the conversion
is in line with the policies and procedures of Raymond
James. |
|
| |
CDSC
Waivers on Classes A, B and C shares available at Raymond
James |
Death
or disability of the shareholder. |
Shares
sold as part of a systematic withdrawal plan as described in the fund’s
prospectus. |
Return
of excess contributions from an IRA Account. |
Shares
sold as part of a required minimum distribution for IRA and retirement
accounts due to the shareholder reaching the qualified age based on
applicable IRS regulations as described in the fund’s
prospectus. |
Shares
sold to pay Raymond James fees but only if the transaction is initiated by
Raymond James. |
Shares
acquired through a right of
reinstatement. |
|
| |
Front-end
load discounts available at Raymond James: breakpoints, and/or rights of
accumulation, and letters of intent |
Breakpoints
as described in this prospectus. |
Rights
of accumulation which entitle shareholders to breakpoint discounts will be
automatically calculated based on the aggregated holding of fund family
assets held by accounts within the purchaser’s household at Raymond James.
Eligible fund family assets not held at Raymond James may be included in
the calculation of rights of accumulation calculation only if the
shareholder notifies his or her financial advisor about such
assets. |
Letters
of intent which allow for breakpoint discounts based on anticipated
purchases within a fund family, over a 13-month time period. Eligible fund
family assets not held at Raymond James may be included in the calculation
of letters of intent only if the shareholder notifies his or her financial
advisor about such assets. |
D.
Shareholders purchasing Fund shares through a Janney Montgomery Scott LLC
(“Janney”) brokerage account will be eligible for the following load waivers
(front-end sales charge waivers and contingent deferred sales charge (“CDSC”),
or back-end sales charge, waivers) and discounts, which may differ from those
disclosed elsewhere in this Fund’s Prospectus or SAI.
|
| |
Front-end
sales charge* waivers on Class A shares available at Janney |
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same fund (but not any other
fund within the fund family). |
Shares
purchased by employees and registered representatives of Janney or its
affiliates and their family members as designated by Janney. |
Shares
purchased from the proceeds of redemptions within the same fund family,
provided (1) the repurchase occurs within ninety (90) days following the
redemption, (2) the redemption and purchase occur in the same account, and
(3) redeemed shares were subject to a front-end or deferred sales load
(i.e., right of reinstatement). |
Employer-sponsored
retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b)
plans, profit sharing and money purchase pension plans and defined benefit
plans). For purposes of this provision, employer-sponsored retirement
plans do not include SEP IRAs, Simple IRAs, SAR-SEPs or Keogh
plans. |
Shares
acquired through a right of reinstatement. |
Class
C shares that are no longer subject to a contingent deferred sales charge
and are converted to Class A shares of the same fund pursuant to Janney’s
policies and procedures. |
|
| |
CDSC
waivers on Class A and C shares available at Janney |
Shares
sold upon the death or disability of the shareholder. |
Shares
sold as part of a systematic withdrawal plan as described in the fund’s
Prospectus. |
Shares
purchased in connection with a return of excess contributions from an IRA
account. |
Shares
sold as part of a required minimum distribution for IRA and other
retirement accounts if the redemption is taken in or after the year the
shareholder reaches qualified age based on applicable IRS regulations.
|
Shares
sold to pay Janney fees but only if the transaction is initiated by
Janney. |
Shares
acquired through a right of reinstatement. |
Shares
exchanged into the same share class of a different
fund. |
|
| |
Front-end
sales charge* discounts available at Janney: breakpoints, rights of
accumulation, and/or letters of intent |
Breakpoints
as described in the fund’s Prospectus. |
Rights
of accumulation (“ROA”), which entitle shareholders to breakpoint
discounts, will be automatically calculated based on the aggregated
holding of fund family assets held by accounts within the purchaser’s
household at Janney. Eligible fund family assets not held at Janney may be
included in the ROA calculation only if the shareholder notifies his or
her financial advisor about such assets. |
Letters
of intent which allow for breakpoint discounts based on anticipated
purchases within a fund family, over a 13-month time period. Eligible fund
family assets not held at Janney Montgomery Scott may be included in the
calculation of letters of intent only if the shareholder notifies his or
her financial advisor about such assets. |
*Also
referred to as an “initial sales charge.”
E.
Shareholders purchasing Fund shares through a Baird platform or account will
only be eligible for the following sales charge waivers (front-end sales charge
waivers and CDSC waivers) and discounts, which may differ from those disclosed
elsewhere in this Fund's Prospectus or the SAI.
|
| |
Front-End
Sales Charge Waivers on Class A shares Available at Baird |
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same fund. |
Shares
purchased by employees and registered representatives of Baird or its
affiliate and their family members as designated by Baird. |
Shares
purchased from the proceeds of redemptions from another VanEck Fund,
provided (1) the repurchase occurs within 90 days following the
redemption, (2) the redemption and purchase occur in the same account, and
(3) the redeemed shares were subject to a front-end or deferred sales
charge (known as rights of reinstatement). |
A
shareholder in the Fund's Class C Shares will have their shares converted
at net asset value to Class A shares of the Fund if the shares are no
longer subject to CDSC and the conversion is in line with the policies and
procedures of Baird. |
Employer-sponsored
retirement plans or charitable accounts in a transactional brokerage
account at Baird, including 401(k) plans, 457 plans, employer-sponsored
403(b) plans, profit sharing and money purchase pension plans and defined
benefit plans. For purposes of this provision, employer-sponsored
retirement plans do not include SEP IRAs, Simple IRAs or SAR-SEPs.
|
|
| |
CDSC
Waivers on Class A and C shares Available at Baird |
Shares
sold due to death or disability of the shareholder. |
Shares
sold as part of a systematic withdrawal plan as described in the Fund’s
Prospectus. |
Shares
bought due to returns of excess contributions from an IRA
Account. |
Shares
sold as part of a required minimum distribution for IRA and retirement
accounts due to the shareholder reaching age based on applicable Internal
Revenue Service regulations as described in the Fund’s
prospectus. |
Shares
sold to pay Baird fees but only if the transaction is initiated by
Baird. |
Shares
acquired through a right of
reinstatement. |
|
| |
Front-End
Sales Charge Discounts Available at Baird: Breakpoints and/or Rights of
Accumulations |
Breakpoints
as described in this Prospectus. |
Rights
of accumulations which entitle shareholders to breakpoint discounts will
be automatically calculated based on the aggregated holding of VanEck Fund
assets held by accounts within the purchaser’s household at Baird.
Eligible VanEck Fund assets not held at Baird may be included in the
rights of accumulations calculation only if the shareholder notifies his
or her financial advisor about such assets. |
Letters
of Intent (LOI) allow for breakpoint discounts based on anticipated
purchases of VanEck Fund shares through Baird, over a 13-month period of
time. |
F.
Shareholders purchasing or holding fund shares, including existing fund
shareholders, through a Stifel, Nicolaus & Company, Incorporated or
affiliated platform that provides trade execution, clearance, and/or custody
services, will be eligible for the following sales charge load waivers
(including front-end sales charge waivers and contingent deferred, or back-end,
("CDSC") sales charge waivers) and discounts, which may differ from those
disclosed elsewhere in the Fund's Prospectus or SAI.
|
| |
Class
A Shares |
As
described elsewhere in this prospectus, Stifel may receive compensation
out of the front-end sales charge if you purchase Class A shares through
Stifel. |
Rights
of accumulation |
Rights
of accumulation (“ROA”) that entitle shareholders to breakpoint discounts
on front-end sales charges will be calculated by Stifel based on the
aggregated holding of all assets in all classes of shares of VanEck Funds
held by accounts within the purchaser’s household at Stifel. Eligible fund
family assets not held at Stifel may be included in the calculation of ROA
only if the shareholder notifies his or her financial advisor about such
assets. |
The
employer maintaining a SEP IRA plan and/or SIMPLE IRA plan may elect to
establish or change ROA for the IRA accounts associated with the plan to a
plan-level grouping as opposed to including all share classes at a
shareholder or pricing group level. |
|
Front-end
sales charge waivers on Class A shares available at Stifel |
Sales
charges may be waived for the following shareholders and in the following
situations: |
Class
C shares that have been held for more than seven (7) years may be
converted to Class A or other Front-end share class(es) shares of the same
fund pursuant to Stifel's policies and procedures. To the extent that this
prospectus elsewhere provides for a waiver with respect to the exchange or
conversion of such shares following a shorter holding period, those
provisions shall continue to apply. |
Shares
purchased by employees and registered representatives of Stifel or its
affiliates and their family members as designated by Stifel. |
Shares
purchased in an Stifel fee-based advisory program, often referred to as a
“wrap” program. |
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same or other fund within the
fund family. |
Shares
purchased from the proceeds of redeemed shares of the same fund family so
long as the proceeds are from the sale of shares from an account with the
same owner/beneficiary within 90 days of the purchase. For the absence of
doubt, shares redeemed through a Systematic Withdrawal Plan are not
eligible for rights of reinstatement. |
Shares
from rollovers into Stifel from retirement plans to IRAs. |
Shares
exchanged into Class A shares from another share class so long as the
exchange is into the same fund and was initiated at the direction of
Stifel. Stifel is responsible for any remaining CDSC due to the fund
company, if applicable. Any future purchases are subject to the applicable
sales charge as disclosed in the prospectus. |
Purchases
of Class 529-A shares through a rollover from another 529
plan. |
Purchases
of Class 529-A shares made for reinvestment of refunded
amounts. |
|
| |
Employer-sponsored
retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b)
plans, profit sharing and money purchase pension plans and defined benefit
plans). For purposes of this provision, employer-sponsored retirement
plans do not include SEP IRAs, Simple IRAs or SAR-SEPs. |
All
other sales charge waivers and reductions described elsewhere in the
fund’s prospectus or SAI still apply. |
|
Contingent
Deferred Sales Charges Waivers on Class A and C Shares |
Death
or disability of the shareholder or, in the case of 529 plans, the account
beneficiary. |
Shares
sold as part of a systematic withdrawal plan not to exceed 12%
annually. |
Return
of excess contributions from an IRA Account. |
Shares
sold as part of a required minimum distribution for IRA and retirement
accounts due to the shareholder reaching the qualified age based on
applicable IRS regulations. |
Shares
acquired through a right of reinstatement. |
Shares
sold to pay Stifel fees or costs in such cases where the transaction is
initiated by Stifel. |
Shares
exchanged or sold in a Stifel fee-based program. |
All
other sales charge waivers and reductions described elsewhere in the
fund’s prospectus or SAI still apply. |
|
Share
Class Conversions in Advisory Accounts |
Stifel
continually looks to provide our clients with the lowest cost share class
available based on account type. Stifel reserves the right to convert
shares to the lowest cost share class available at Stifel upon transfer of
shares into an advisory program. |
G.
Shareholders purchasing Fund shares through an Ameriprise Financial brokerage
account are eligible for the following front-end sales charge waivers, which may
differ from those disclosed elsewhere in this Fund’s prospectus or
SAI.
|
| |
Front-End
Sales Charge Waivers on Class A shares Available at Ameriprise
Financial |
Employer-sponsored
retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b)
plans, profit sharing and money purchase pension plans and defined benefit
plans). For purposes of this provision, employer-sponsored retirement
plans do not include SEP IRAs, Simple IRAs or SAR-SEPs. |
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same Fund (but not any other
fund within the same fund family). |
Shares
exchanged from Class C shares of the same fund in the month of or
following the 7-year anniversary of the purchase date. To the extent that
this prospectus elsewhere provides for a waiver with respect to exchanges
of Class C shares or conversion of Class C shares following a shorter
holding period, that waiver will apply. |
Employees
and registered representatives of Ameriprise Financial or its affiliates
and their immediate family members. |
Shares
purchased by or through qualified accounts (including IRAs, Coverdell
Education Savings Accounts, 401(k)s, 403(b) TSCAs subject to ERISA and
defined benefit plans) that are held by a covered family member, defined
as an Ameriprise financial advisor and/or the advisor’s spouse, advisor’s
lineal ascendant (mother, father, grandmother, grandfather, great
grandmother, great grandfather), advisor’s lineal descendant (son,
step-son, daughter, step-daughter, grandson, granddaughter, great
grandson, great granddaughter) or any spouse of a covered family member
who is a lineal descendant. |
Shares
purchased from the proceeds of redemptions within the same fund family,
provided (1) the repurchase occurs within 90 days following the
redemption, (2) the redemption and purchase occur in the same account, and
(3) redeemed shares were subject to a front-end or deferred sales load
(i.e. Rights of Reinstatement). |
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For
more detailed information, see the Statement of Additional Information (SAI),
which is legally a part of and is incorporated by reference into this
prospectus. The SAI includes information regarding, among other things: the Fund
and its investment policies and risks; management of the Fund, investment
advisory and other services, the Fund’s Board of Trustees, and tax matters
related to the Fund.
Additional
information about the investments is available in the Fund’s annual and
semi-annual reports to shareholders. In the Fund’s annual report, you will find
a discussion of the market conditions and investment strategies that
significantly affected the Fund’s performance during its last fiscal
year.
▪Call
VanEck at 800.826.2333, or visit the VanEck website at vaneck.com to request,
free of charge, the annual or semi-annual reports, the SAI, information
regarding applicable sales loads, breakpoint discounts, reduced or waived sales
charges and eligibility minimums, or other information about the
Fund.
▪Reports
and other information about the Fund are available on the EDGAR Database on the
SEC’s Internet site at http://www.sec.gov. In addition, copies of this
information may be obtained, after paying a duplicating fee, by electronic
request at the following e-mail address: [email protected].
▪For
more information about the different sales load variations imposed by financial
intermediaries, see Appendix A, “Intermediary Sales Charge Discounts and
Waivers,” which is incorporated herein by reference and is legally a part of
this prospectus.
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Transfer
Agent:
SS&C
GIDS, Inc.
P.O.
Box 218407
Kansas
City, Missouri 64121-8407
SEC
Registration Number: 811-04297
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800.826.2333 vaneck.com |
CMCIPRO |